Fundamental Report for Week of April 25 – May 1, 2010
Fundamental Report for Week of April 25, 2010
Monday:
Relatively slow news day with one shining spot for the USD. The Dallas Fed Manufacturing Activity that measures the overall business climate for Texas’ manufactures jumped from 7.2% to 21.1%. This wasn’t really enough to move the market on its own, but could be a good indicator that the US will see good Gross Domestic Product (GDP) numbers again this month.
The market sold off the dollar briefly during the day, but the Asian session brought a big swing the USD side that held into Tuesday’s European session.
Tuesday
European session gave volume to the USD rally especially against the Euro and the Cable. The Eurozone actually put out some positive economic news with increased consumer and business confidence in Italy and France. However once coupled with doubts about Greece, a downgrade for Portugal and with a huge hit to Germany’s import prices ((YoY) data jumping from 2.6% to 5%) the Euro couldn’t hold on to its gains from the previous European Session.
The USD sustained the rally, against the Euro, the Pound, the Aussie and the Kiwi throughout the New York session as the market seemed to be wary of any surprises that may be in store from Bernanke in the upcoming interest rate decision on Wednesday. Early Asian session brought consolidation while the market cooled its heels and prepared itself for the announcement.
Wednesday:
The market seemed to take a breather after Tuesday’s drive into the safe haven of the USD. There were no surprises in the Federal Open Market Committee (FOMC) rate decision, however the Kiwi briefly strengthened on the surprise narrowing of New Zealand’s trade deficit (from -347 to -194 YTD).
With the exception of a bit of JPY selling, most everything stayed stable.
Thursday:
The Euro and the Pound reset the game a bit, making gains on some positive jobs news in Germany and better than projected housing data in the United Kingdom. The UK is in its final election throes however with one more week to go, so more volatility is possible with the GBPUSD.
Market slowed significantly by New York close in anticipation of the US Gross Domestic Product (GDP) report to be released on Friday.
Friday:
The US GDP Index did see an increase from .5% to .9%, however that wasn’t enough to raise the annualized number. In fact it fell a bit from 5.6% to 3.2 % slightly shorter than the market’s anticipated 3.4%, but growth none the less. The US also so one of the first of many manufacturer’s report, the Chicago Purchasing Managers’ Index rise to 72.2 from 69.5 as well as a rise in the U of M Consumer Sentiment Index, which may signal another round of positive numbers to keep the US making “things” in May. Making “things” means that there is room for employment growth, good news of the USD long term.
Canada had a slight dip in their GDP as well, dropping from from .6% to .3% merely weakening the CAD to previous consolidation levels.
The Eurozone saw an increase in Producer prices which leads, not surprisingly to an increase in Consumer Prices. While their unemployment numbers stayed steady at 10% that does raise an interesting condundrum in terms of inflation…which we know how much Trichet loathes inflation, so that will be something to watch in the next month or two.
What to watch for next week, May 2nd – 8th:
What I’ll be watching and in parenthesis why:
Monday:
- New Zealand Commodity Prices (Producer Price Index (PPI)).
- US Personal Spending and Personal Income (Retail Sales).
- US ISM Manufacturing PMI (GDP).
Tuesday:
- EUR Retail Sales
- GBP Manufacturing PMI (GDP)
- USD Factory Order (GDP)
Wednesdsay:
- EUR Germany’s PMI (GDP)
- GBP Construction PMI (Employment)
- NZD Employment numbers
Thursday:
- GBP Services PMI (Employment)
- EUR Germany Factory Orders (GDP/Employment)
- EUR Interest rates
- CAD Ivey PMI
Friday:
- CAD Employment
- USD Employment
- USD Consumer Credit
What will you be watching (or trying to ignore)?
Triffany Hammond helps traders of all levels, gain the tools, resources and guidance necessary to build on their strengths and work around their weaknesses so that they can make the best possible decisions for themselves in the Forex Market. Triffany is a regular speaker and contributor at 
