Unemployment Claims On Calendar

11-03-2010

USD
The USD had a mixed day among the major currencies in range bound movement. In early trading the greenback pushed the EUR and GBP around but as the day wore on the USD began to give back its gains. Wall Street turned in a positive day on Wednesday. Wholesale Inventories decreased by -0.2%, which did surprise the market as these numbers suggested sales have been stronger than expected. The question that must be asked now is if businesses will follow through and purchase additional product and hope consumption is actually increasing. Today weekly Unemployment Claims are on the calendar and they are expected to see an improvement compared to last week’s outcome. American Trade Balance numbers will also be published.
This has been a quiet week of data from the U.S. and today’s unemployment numbers could spark some volatility if they produce a surprise. If that does not happen, then it will probably rest upon tomorrow’s Retail Sales numbers and the Consumer Sentiment reading from the University of Michigan to bring impetus into what has been a rather risk adverse crowd. Timothy Geithner provided some spark yesterday when he commented that any new regulations on Hedge Funds and Private Equity Groups would have to be examined more closely and that European proposals would be unfair for U.S. firms if they were to be approved in their current form. These comments may be enough to help add some positive sentiment into the U.S. markets, which have viewed many of the current administrations comments as anti-free market. Risk appetite has been rather restrained the past couple of weeks and we have seen rather consolidated results on Wall Street and a stronger USD. The greenback’s strength the past few months cannot be denied but short term trading is likely to be rather opportunistic.

EUR
The EUR was able to gain some footing as the trading day came to an end on Wednesday. European data released yesterday showed that the French and Italian Industrial Production numbers were better than forecasted. This will be welcome news for investors in the European Union who have been dealing with a dark tide of rather negative sentiment the past couple of months stemming from whispers regarding the possibility of a double dip recession and the Greek debt dynamics. Data will be muted from the E.U. today with only the ECB Monthly Bulletin on the schedule. Tomorrow broad Industrial Production numbers for the continent will be brought forth. The crux of the matter regarding the EUR is the continuing flurry of news that is developing around the Greek debt crisis. After last weekend’s ‘road show’ by the Greek government and daily pronouncements, official speeches have become a bit more tranquil the past two days perhaps allowing traders to exhale. The EUR remains on the weaker side of its range against the USD and is likely to face intermittent pressure the next two days.

GBP
A rather interesting range has emerged for the Sterling the past two days as it continues to stagnate nears its lower depths against the USD. Manufacturing Production data was released yesterday and proved negative with a result of minus -0.9% compared to the expected gain of 0.3%. The economic releases from the U.K., thus has kept its rather lackluster outcomes on a steady pace. Today and tomorrow will be quiet for data and this will keep the GBP under a rather murky sentiment which is sure make for a challenging trading atmosphere. The Sterling has faced plenty of pressure in recent sessions and if risk appetite does not show any sudden increase the GBP could continue to be tested.

JPY
The JPY lost a small amount of ground to the USD on Wednesday as international bourses turned in slightly positive results. The JPY remains in an extremely tight range that seems to be moving on the amount of caution that weighs in on the marketplace. Gold turned in a day worth noting yesterday as it slumped to around 1106.00 USD an ounce, this as the greenback turned in a mixed day. Gold needs to be watched and the question traders will ask is if the precious metal was merely range trading yesterday and will bounce back or if this is a sign that its consolidation may be about to change.

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