Go Back   English Forum Switzerland > Help & tips > Finance/banking/taxation  
Reply
 
Thread Tools Display Modes
  #1  
Old 07.04.2011, 09:44
grumpygit's Avatar
Forum Veteran
 
Join Date: Feb 2011
Location: geneva
Posts: 1,476
Groaned at 29 Times in 16 Posts
Thanked 1,508 Times in 695 Posts
grumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond repute
Forex report for 07 april- is this interesting for anyone?

EUR could face tactical downside pressure heading into ECB press conference

But ECB is credible on the inflation fight while the Fed is not: EURUSD dips present good opportunities to ride the sovereign bid higher

AUD remains a buy on dips as employment jumps

The highlight today for the currency markets will be Trichet's press conference following the ECB decision, widely anticipated to see a 25 bps rate hike up 1.25%. The market will be looking for signals to determine the likelihood and timing of further rate hikes: will the reference to "strong vigilance" on inflation be dropped in favour of "monitoring very closely"? Or will the sentence that the ECB "remains prepared to act in a firm and timely manner" stay - which in our economists' judgement is consistent with with a rate rise as soon as June? Ahead of the event, considering the run up in expectations on the pace of rate hikes (OIS markets have moved to price in rate hikes near 130 bps from the ECB over the coming 12 months from just under 95bps in early March), there is some scope for disappointment. Tactical players may see reason to sell the EURUSD in the minutes and hours following the press conference.
However the press conference will likely matter only in the very short term. The driver behind a higher EUR remains the sovereign bid as Asian and Middle Eastern monetary authorities continue to diversify FX reserves out of USD. Whether they continue to see greater value in EUR as opposed to the USD remains a question of perceived credibility in dealing with inflation. While Trichet will likely be more balanced than Stark - who was quite hawkish in his FT guest column last week - the ECB is united in aiming to nip in the bud any shift towards higher inflation expectations. In contrast, the FED is clearly divided in its members' views on post-QE2 policy; and little clarity is likely before the April 27 FOMC. We continue to see any dips as presenting good medium term buying opportunities.
While today's BoJ meeting produced little in the way of surprises - the central bank will make JPY 1tr in cheap loans available to banks affected by the earthquake - markets are looking for a more significant action at a second policy meeting on April 28. Expectations of more liquidity are likely to put further pressure on the yen over the coming weeks, significant resistance at the bottom of the weekly ichimoku cloud chart at 85.75 is likely to cap USDJPY for this week.
The fall in the Australian unemployment rate to 4.9% signals increased tightness in the labour market and will have the RBA looking carefully once again at the potential inflationary impact. Markets have moved to price in a 20-25% chance of a hike as early as July. In the short term the 1.05 barrier may cap the move for today, perhaps aided by some profit-taking on AUDJPY post-BoJ. Into next week though, with little sign of a USD rebound, and with the Chinese tightening impact offset by the increase in JPY liquidity, AUDUSD has further upside - but we continue to prefer playing AUD strength through JPY rather than USD.
Little is expected from the BoE today, but we note in today's Market Focus that UK CDS continue to fall, suggesting that investors are increasingly comfortable that the government's fiscal consolidation strategy is working. With the BoE looking likely to hike in May, the bid for sterling assets is likely to remain solid. While downside in EURGBP is likely to be limited, GBPUSD has further upside potential while UK data remains broadly supportive of the growth story.
Reply With Quote
This user would like to thank grumpygit for this useful post:
  #2  
Old 07.04.2011, 10:08
sankbhat's Avatar
Forum Veteran
 
Join Date: Feb 2009
Location: Near Lucerne
Posts: 544
Groaned at 12 Times in 9 Posts
Thanked 344 Times in 159 Posts
sankbhat is considered knowledgeablesankbhat is considered knowledgeablesankbhat is considered knowledgeable
Re: Forex report for 07 april- is this interesting for anyone?

What terrible font!
Reply With Quote
  #3  
Old 07.04.2011, 10:10
grumpygit's Avatar
Forum Veteran
 
Join Date: Feb 2011
Location: geneva
Posts: 1,476
Groaned at 29 Times in 16 Posts
Thanked 1,508 Times in 695 Posts
grumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond reputegrumpygit has a reputation beyond repute
Re: Forex report for 07 april- is this interesting for anyone?

Quote:
View Post
What terrible font!
I shall take that as a no then. would have thought that content was more important.
Reply With Quote
Reply




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Forex trading anyone? Fesken1 Finance/banking/taxation 30 13.05.2017 21:17
Forex taxes in Switzerland staw Business & entrepreneur 5 23.04.2010 20:02
Forex traders taxes? Gaggiol0 Business & entrepreneur 17 23.09.2009 20:29


All times are GMT +2. The time now is 04:30.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2022, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0