 The Dollar strengthened versus its main rivals as investors positioned themselves ahead of US earnings and a Greek bond auction. While the Yen recovered its losses following its Sunday election, the Pound faltered in its attempt to regain its overnight losses as S&P reiterated its negative outlook of the country’s credit rating. The Euro and Canadian Dollar were weaker against the greenback even at the mid-point of NY trading. |
 With stocks sliding around the world on fears of a double dip recession amidst the belt tightening message of the G20 and a sharp drop in consumer confidence in the US, safe haven currencies like the Yen and Dollar gained against riskier currencies like the Pound and commodity currencies like the the Canadian and Australian Dollars. |
 The focus early this week is on the shaky footing of the global recovery. With concerns increasing about the pace of global growth and increasing concerns about financial system stability, investors fled from risky assets and higher yielding currencies into safe haven currencies like the Dollar and Yen. |
 The dollar traded mostly higher on Monday. US personal income posted a third successive monthly gain in May and personal spending increased. The S&P 500 declined 2.19 to 1,074.57. The yen was down modestly. Japan’s month-on-month retail sales fell the most in five years. The euro dropped ahead of the expiration of the large-scale European Central Bank lending facility later this week. Banks have to repay €442 billion in oneyear funds to the ECB on Thursday. Following Friday’s penetration of important resistance, the pound rose on comments by Bank of England policy maker Andrew Sentence who said UK interest rates need to rise slowly. The Australian and Canadian dollars were little changed. |
 The dollar, while rising against the Canadian dollar, fell versus other major currencies on Thursday. The dollar index declined for the sixth time in eight days to 85.68, approaching the important 85-area support. US economic figures were weak. Jobless claims increased, Philadelphia-area manufacturing growth slowed, and consumer-price inflation remains tame. |
 Risk appetite continued to power the Euro higher as US stocks soared in today’s trading. In a roundup of data from around the world the Bank of Japan unveiled a new program to stimulate lending, a measure of German investor confidence slid sharply, and UK inflation was tamer than expected. In US data a regional US manufacturing survey showed activity expanding, import prices slid, homebuilders became more pessimistic, and foreigners continued to flock to US Treasuries. |
 The dollar fell against most major currencies on Monday. Global recovery optimism rose after data showed eurozone April industrial production posted the largest year-on-year gain since records started in 1991. The yen reversed overnight losses. The S&P 500 reversed earlier gains and fell 1.97 to 1,089.63 after Moody’s Investors Service said it downgraded Greece’s government bond ratings by four levels to Ba1 from A3. |
 Overnight the risk rally from last week was extended as we had stronger than expected industrial production data from the Euro-zone and quarterly manufacturing report from Japan. The Euro, Pound and commodity currencies rallied against the Dollar, our so called “risk-on” trades. However, in late NY trading Moody’s downgraded Greece which cut gains in US stocks and in oil prices which pressured the Canadian Dollar and the US Dollar against the Yen. |
 There was a slew of reports on the fundamental docket including strong Chinese trade data, a strong Australian jobs report and better thane expected Japanese GDP data. That helped set off some risk appetite in global markets. We had 3 central bank decision – from the RBNZ, BOE and ECB. In North America we saw US trade and jobless claims data as well as trade figures from Canada. |
Japan’s Batch of Data Shows Higher Unemployment, Weak Production
Fundamental Updates \ Nick Nasad \ 12:32 PM EDT \ July 30th, 2010Overnight, we got end-of-the month statistics from Japan. While there was a positive report in the form of stronger than expected household spending for the month of June, a rise in the unemployment rate and a drop in industrial production dampened any enthusiasm for the Japanese economy.