US Morning Notes – USD and JPY lower, risk appetite improves as stocks rally

by Forex Trading HQ on August 2, 2010

in North America Forex Report

FX Highlights

  • The USD is trading marginally lower as global equity markets rally to a two week high supported by upbeat US economic data and optimism about the global recovery, EUR gains limited by report of weak EU retail sales, GBP rallies in reaction to report of rising UK house prices with gains limited by a downgrade of BP’s rating, AUD trades higher supported by report of better than expected Australian trade balance, CAD supported by a statement from Canada’s finance minister that the time is nearing for G-20 exit strategies, JPY trades lower pressured by improving risk appetite and speculation that Japan’s Finance Minister Kan will become Japan’s new PM, Kan in the past has favored a weak JPY policy
  • Focus turns to the release of US ADP employment, jobless claims, factory orders and non manufacturing ISM
  • Japan’s Q1 CAPEX falls 11.5%, Suda says that EU debt crisis may hurt Japan ,sees more downside risk to the economy, deflationary pressures continue, JPY lower
  • Australia’s April trade balance swings to A$ 134mln surplus, exports rose by 11%, imports unchanged, May new vehicle sales rose by 9.6%, AUD higher
  • EU April retail sales declined by 1.2%, May final services PMI rises to 56.2 from 56,EUR mixed
  • UK May services PMI rises to 55.4 from 55.3 last month, May Nationwide house prices rose by 0.5%,GBP higher
  • Canada’s Finance Minister Flaherty says time is nearing for G 20 nations to begin exit strategies, CAD higher
  • The Feds Lockhart says time is approaching to begin recalibrating monetary policy
  • US equity markets set to open higher, European equities 2% higher, Nikkei closed 311 points higher

Upcoming Events

  • US- Thursday, May ADP employment will be released expected at 60k compared to 32k last month along with initial jobless claims for week ending 05/29 expected at 450k compared to 460k last week, April factory orders expected at 1.8% compared to 1.1% last month, and May non manufacturing ISM expected at 55.5 compared to 55.4 last month
  • CAN-Thursday, no major Canadian economic data is due for release today

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