07-02-12 - Greece torment continues

Developments in Greece are liable to dominate again on Tuesday as politicians move in ever-decreasing circles to square the circle of further demands for spending cuts with the rising fear of depression. Comments from interim Swiss National Bank head Jordan and Fed Chairman Bernanke will also be important.

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05-02-12: Preview - Reality check in prospect 

Harsh arctic winds have reminded Europe that winter still has a sting and risk conditions will find it difficult to build on the US payroll data, especially with European governments looking to back-slide on economic reforms and Greece still not resolved.     

Read more:  Weekly preview - Risk appetite set to freeze

 

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MARKET UPDATE  - The Australian dollar has been the main focus on Tuesday as the currency spikes higher following the Reserve Bank decision not to cut interest rates at today's meeting.  China conditions likely to be an increasing focus of concern as equities sliding again while growth fears are intensifying.  07-02-12:  06.55 GMT

MARKET UPDATE  - The Euro is still being sold on rallies as it dips back to below 1.31 in Asia on Monday as Greek political parties are still short of an agreement. Overall risk appetite still holding relatively firm following Friday's US payroll data, but AUD/USD is well off Friday's highs.  06-02-12:  04.55 GMT

MARKET UPDATE  - The move back towards 1.32 for EUR/USD is not about Euro strength, it is a function of dollar weakness as global defensive demand for the US currency dips. Sterling has pushed to five-month highs against the dollar while commodity currencies are also performing strongly.  02-02-12:  04.55 GMT

MARKET UPDATE  - The Euro retreated back to below 1.31 against the dollar on Monday as risk appetite faded, but there was renewed support for the currency on Tuesday as the dollar was unable to sustain buying support. EUR/USD back near 1.32 in Asian trading as shorts faced another test of nerve.  31-01-12:  04.55 GMT

MARKET UPDATE  - The Euro pushed to highs above 1.31 following the dovish Fed statement and extended gains in Europe on Thursday following reports that a Greek debt restructuring deal could be close.  26-01-12:  11.50 GMT

MARKET UPDATE  - Battle continues to rage around the 1.30 area in EUR/USD with firm buying support on dips. Overall risk appetite remains firm on reduced fears of a systemic crisis in the banking sector as the powerful liquidity operations work their short-term magic on market sentiment.  25-01-12:  03.20 GMT

MARKET UPDATE  - The Euro peaked near 1.3050 against the dollar before retreating again as there was a Euro-group rejection of Greek PSI terms. There has also been profit taking in risk currencies, although sentiment should remain relatively firm for now.  24-01-12:  02.55 GMT

MARKET UPDATE  - Risk appetite remains firmer and the Euro has continued to gain short-covering support from successful European bond auctions. The calmer conditions may not survive much longer given underlying stresses within the banking sector.  20-01-12:  06.35 GMT

MARKET UPDATE  - A measure of calm has retuned following Friday's high volatility triggered by the long-awaited Standard & Poor's downgrading of France. Risk appetite has been underpinned by slightly better than expected Chinese GDP data and the Euro has been lifted back to above 1.27 against the dollar by a covering of short positions. 17-01-12:  03.15 GMT

MARKET UPDATE  - The Euro was unable to sustain gains on Wednesday and dipped sharply after Fitch's warning that the ECB needs to do much more to prevent a cataclysmic Euro collapse.  EUR/USD dips to lows near 1.2660 before finding some tentative support. 12-01-12:  03.05 GMT

DATA ALERT - Overnight deposits at the ECB increase to a record EUR481.9bn. This is a huge figure and again illustrates a complete lack of confidence in the European bank. Lending levels are liable to remain under sustained pressure  10-01-12 :  08.50 GMT

MARKET UPDATE  - The US payroll data was stronger than expected with a 200,000 gain and unemployment at 8.5%. Generally a solid release as private-sector jobs, especially in transport were able to offset a further fall in government jobs.  Generally positive for the dollar which moves to 1.27 against the Euro. 06-01-12:  15.35 GMT

MARKET UPDATE  - The Euro has remained under pressure and retreated again in the Asian session on Friday with lows below 1.2770 for fresh 16-month lows.  Euro finding it hard to gain support even when risk appetite improves.  06-01-12:  06.10 GMT

MARKET UPDATE  - The Euro is subjected to renewed pressure with a sharp retreat back to near 1.29 while Sterling hits a 12-month high against the Euro. Euro-zone fears increase again as the scale of problems within the banking sector renews the fear factor.  04-01-12:  15.45 GMT

MARKET UPDATE  - Risk conditions remain more favourable at the start of the first full trading day of 2012 with firm Chinese data helping to boost spirits. AUD/USD gains ground and Euro also firmer, but deposits as the ECB increase back to near-record levels which is not a good sign.  03-01-12:  08.20 GMT

MARKET UPDATE  - EUR/USD continues to find support below 1.29 on the last trading day of 2011.  last-minute window dressing and repatriation flows will tend to dominate on Friday as liquidity levels remain extremely low.  30-12-11 :  02.40 GMT

MARKET UPDATE  - Market suddenly explodes into life with aggressive Euro and Sterling selling against the dollar. Big banks looking to trigger stop losses in thin trading have succeeded extremely well as initial move was provoked by a bigger than expected ECB balance sheet which suggested quantitative easing.  28-12-11 :  14.50 GMT

DATA ALERT - Overnight deposits at the ECB increase to a record EUR411.8bn. Partly due to year-end factors, but hardly a vote of confidence by the banks.  27-12-11 :  08.50 GMT

MARKET UPDATE - At the moment, the market is grinding towards halt ahead of the Christmas break with the Euro finding solid support on any dips towards 1.30 against the dollar. Risk conditions are solid with the Australian dollar retaining gains.  23-12-11 :  04.50 GMT

MARKET UPDATE - The Euro spiked higher to near 1.32 against the dollar on Wednesday before an equally sharp decline to the 1.3020 area as the US currency also regained lost ground. China will be an important focus given the possibility of more reserve ration requirement cuts in the short term.  22-12-11 :  03.30 GMT

MARKET UPDATE - The Euro has continued to fluctuate around the 1.30 level. There has been further solid EUR/USD buying support below 1.30 with markets reluctant to sell aggressively given the number of existing short speculative positions in the market.  20-12-11 :  07.00 GMT

MARKET UPDATE - The Euro has continued to fluctuate around the 1.30 level as pressure for consolidation after a sharp slide is offset by underlying fears surrounding the Euro-zone outlook as political tensions continue.  EUR/USD close to the 1.3025 level.  16-12-11 :  07.15 GMT

MARKET UPDATE - French ratings rumours have been doing the rounds again as players try to trigger more stop losses below the 1.30 EUR/USD level. Commodities generally under pressure as de-leveraging continues with little in the way of solid data.   14-12-11 :  15.15 GMT

MARKET UPDATE - The Euro remains vulnerable following another sharp sell-off in New York on Tuesday. The 1.30 level against the dollar will remain a short-term focus, especially with reports of strong option defence in this area. ECB data will be watched closely at the European open.  14-12-11 :  07.00 GMT

MARKET UPDATE - There has been a slight improvement in risk appetite with Wall Street opening higher, but the Euro is finding it very hard to participate and at the moment is still trapped below 1.32 against the dollar which suggests that a lack of yield support is weighing on the currency  13-12-11 :  15.20 GMT

MARKET ALERT - The Shanghai equity market weakens by close to 2% on Tuesday and dips to a 33-month low which helps maintain a negative underlying tone towards risk appetite ahead of the European open. latest ECB borrowing data will be watched closely to see if bank stresses are continuing to increase.  13-12-11 :  07.35 GMT

MARKET UPDATE - The Euro is drifting slightly weaker ahead of the European open on Monday, although ranges remain very narrow. There has been further speculation that Standard & Poor's will announce a downgrading of Euro-zone ratings.  12-12-11 :  06.40 GMT

MARKET UPDATE - The Euro failed to hold initial gains following the ECB interest rate decision and was subjected to heavy selling pressure as Bank president Draghi ruled out ECB financing of government debt. EUR/USD dipped to lows below 1.33 and a recovery quickly ran into trouble in Asia on Friday.  09-12-11 :  03.50 GMT

MARKET UPDATE - US dollar drifts weaker in early Europe on Wednesday. Markets looking for more progress at the EU Summit and are pricing in a slightly more optimistic stance which is lessening any defensive dollar demand, but ranges are narrow.  07-12-11 :  07.20 GMT

MARKET UPDATE - The S&P warnings over European sovereign-debt downgrades put the Euro back on the defensive following the Merkel-Sarkozy mini-summit. Markets also staying very cautious over the banking sector and rumours of failure will continue to swirl around markets.  06-12-11 :  08.20 GMT

MARKET UPDATE - The Euro gained some support on improved risk appetite following the US unemployment decline, but it was unable to hold above 1.35 against the dollar and weakened again in late European trading on rumours of another Spanish sovereign-debt downgrade.  05-12-11 :  03.20 GMT

MARKET UPDATE - The Euro has been unable to hold its best levels as ECB head Draghi gives a sobering assessment of the situation to the European parliament and downplays the possibility of more aggressive ECB action. EUR/USD back to below 1.3450.   01-12-11 :  08.50 GMT

MARKET UPDATE - There has been a big turn-around in the market as central banks, led by the Federal Reserve act to boost market liquidity by effectively capping rates and easing funding stresses by increasing the availability of dollars. Risk appetite surges with strong gains on equity markets and there are sharp gains for the Euro and commodity currencies, especially after stronger than expected ADP employment data from the US.   30-11-11 :  15.35 GMT

MARKET UPDATE - There has been further choppy trading with EUR/USD unable to sustain the move to above 1.34 on Tuesday.  If the ECB is forced into any form of quantitative easing then the Euro-zone outlook may be safer, but there would still be the risk of heavy selling in the Euro.   30-11-11 :  08.20 GMT

MARKET UPDATE - The Euro has maintained a stronger tone and risk appetite also improves on the back of advancing stock markets. So far, EUR/USD has not been able to push above the 1.34 level as the pattern of rumours and denials continue.  28-11-11 :  15.05 GMT

MARKET UPDATE - The Euro and risk appetite receive an important boost with speculation that the IMF will announce a EUR600bn support package for Italy and Spain. EUR/USD hits a high around 1.3340 before retreating back to the 1.33 area as the reports are denied by the IMF.  28-11-11 :  03.55 GMT

MARKET UPDATE - German Chancellor Merkel's hard-line stance on the possibility of Eurobonds has further increase fears surrounding the Euro-zone economy and Euro.  EUR/USD dips to lows near 1.33 as Asian equity markets continue to decline. Very difficult to secure any near-term relief.  25-11-11 :  05.50 GMT

MARKET UPDATE - Euro reached the 1.34 area following the German IFO index, but could not extend the recovery and has retreated back to below 1.3350 as German Chancellor Merkel holds firm against Eurobonds, contrary to some media report. Market may die during US trading due to Thanksgiving, but don't take it for granted.  24-11-11 :  13.50 GMT

MARKET UPDATE - Euro dipped to lows of 1.3320 as risk appetite deteriorated again following a very weak German bond auction. There has been a tentative rebound to the 1.3380 area with players reluctant to extend short positions ahead of the Thanksgiving Holiday.  24-11-11 :  02.50 GMT

MARKET UPDATE - Mixed Euro-zone PMI readings with weak manufacturing data, but a recovery in services. Financial sector likely to dominate and some very tentative evidence that stresses are easing slightly in Europe, but confidence will remain fragile at best given the threat of a major banking-sector collapse.  23-11-11 :  08.55 GMT

DATA ALERT - The flash China HSBC manufacturing PMI index falls to 48.0 for November from 51.0 which will further undermine international risk appetite.  23-11-11 :  02.40 GMT

MARKET UPDATE - The Euro unable to hold above 1.3550 against the dollar and retreats to test support below 1.35 following worse than expected US GDP data which triggers a fresh bout of risk aversion.  Difficult to break out of prevailing ranges at this time, but Wednesday's Euro-zone data will be important.  22-11-11 :  16.20 GMT

MARKET UPDATE - The Euro benefits from another round of short covering and moves towards the 1.3550 area against the dollar. There's a pause in equity market selling on relief that the US credit rating has not been downgraded again as fiscal policy heads for deadlock again.  22-11-11 :  08.35 GMT

MARKET UPDATE - Stronger than expected US new home sales data helps recue risk appetite and the Euro, especially as the amount of ECB bond purchases last week was held to just above EUR8bn with the market braced for a much bigger figure. Underlying sentiment still very fragile.  21-11-11 :  15.35 GMT