LONDON (SHARECAST) - This is a review of the elements likely to affect foreign exchange (forex) trading in Europe on Thursday.
Central banks: European Central Bank (ECB); Swiss National Bank (SNB), Norwegian central bank (Norges)
Currency codes: EUR - euro; USD - US dollar; GBP - sterling; JPY - Japanese yen; CHF - Swiss franc; NOK - Norwegian kroner; SEK - Swedish kroner; CAD - Canadian dollar (the loonie); AUD - Australian dollar; NZD - New Zealand dollar; Loonie: Canadian dollar; Cable: Sterling/US dollar
Draghi Takes On Bundesbank Orthodoxy in Defence of ECB’s Bond-Buying Plan - Bloomberg
Will China Lend Battered Euro Zone a Helping Hand? - CNBC
US second-quarter growth revised up, Fed still seen in play - Reuters
No surprises likely from Bernanke - FT
Bernanke's Words Could Make or Break the Market Rally - CNBC
Japan Retail Sales Slide as End of Car Subsidies to Further Damp Spending - Bloomberg
Fed Beige Book shows gradual economic growth - Reuters
Party Over? Economist Sees No-Growth Decade Looming - CNBC
July pending home sales touch two-year high - Reuters
GOP Officially Nominates Mitt Romney for President - CNBC
Ryan puts down calculator, picks up bullhorn - Reuters
American Gasoline a Bargain as Drivers Pay 63% Less Than Norway - Bloomberg
Gross Says QE3 Likely Even if Bernanke Doesn’t Provide Hint - Bloomberg
Buffett’s Wells Fargo Bet Helps Berkshire vs. S&P 500 - Bloomberg
Canadian Dollar Gains Versus Majors as US Economic Growth Beats Forecast - Bloomberg
Brazil cuts interest rates to new low - FT
Mexico reports first deepwater oil strike - FT
Asian Stocks Erase Monthly Advance on Economic Concerns - Bloomberg
China, Germany plan to settle more trade in yuan, euros - Reuters
Battle for Yuan Supremacy Fuels Hong Kong Banker Rivalry - Bloomberg
Japan Inc intensifies investment abroad - FT
Australia’s Growth Cushion Deflates as Currency Retains Its Surge - Bloomberg
South Korea hit by imports drop - FT
South Korean Manufacturer Confidence Stays Near Post-Crisis Low - Bloomberg
Philippine Growth Beats Estimates as Spending Counters Risks - Bloomberg
Nissan Ships Cars Home as Yen Erodes Made-in-Japan - Bloomberg
Draghi rebuffs Germans over euro plans - FT
Rajoy Seeks Support for Spain Debt as Regions Line Up for Aid - Bloomberg
Hollande Sets Plan to Create Youth Jobs - WSJ
French PM: 75% Tax Will Not Define Government - CNBC
Greece Makes Late Push on Cuts - WSJ
Dutch Candidates Embrace Euro-Scepticism - WSJ
Brussels cuts Ireland’s growth forecast - FT
Swiss-Style Latvian Banking Hub Thrives On Ex-Soviet Cash Flood - Bloomberg
Russia’s Oldest Funds Quit Moscow as Investors Curb Risk - Bloomberg
EUR: The main euro crosses are edging higher as market participants wait for Draghi’s words next week. The speculation about ECB action in the bond market is propping up the common currency. Acting as as a backdrop, during her trip today to China Angela Merkel is expected to try to boost peripheral bond purchases by China’s sovereign funds. Nevertheless, Moody’s says that the Eurozone crisis continues to pose the greatest risk to global macro outlook; but about the US fiscal cliff and China’s slowdown? EUR-USD is still trading a tad above 1.2550 while EUR-JPY is holding above 98.50.
GBP: The sterling crosses are moving sideways. Today’s economic indicators in the UK are not expected to have an impact on them. Cable is below 1.5850, while GBP-JPY trades close to 124.55. The flag pattern to be seen in the EUR-GBP didn’t hold and the pair is now trading at 0.7921.
CHF: The Swiss franc is exhibiting subdued price action. For its part, EUR-CHF is in its familiar trading range close to 1.2010. Meanwhile, USD-CHF is still below 0.9600. The SNB is rumoured to be selling some of the reserves which it amassed.
Nordics: The NOK and the SEK are paring yesterday’s gains versus the euro and the dollar. According to Norges Bank deputy governor Qvigstad, Norway won’t tolerate persistent kroner gains. Eurozone debt crisis concerns favour both pairs as a haven. Yesterday, the NOK appreciated after the Norges Bank left its official interest rate unchanged at 1.50%.
USD & JPY: The US dollar is in a wait-and-see stance before Ben Bernanke’s long-awaited speech at the Federal Reserve Symposium in Jackson Hole, Wyoming. As expected, yesterday's second estimate for US Q2 GDP (gross domestic product) saw an upwards revision to an annualized rate of 1.7% from the 1.5% preliminary estimate. Despite this reading, the economy has been decelerating in the last three quarters due to weak private consumption and investment levels. Today, we will be paying close attention to initial jobless claims as well as personal consumption expenditure numbers. USD-JPY trades close to 78.65.
CAD, AUD & NZD: Upbeat economic indicators in New Zealand are buoying the kiwi. The aussie and the loonie are weaker. Australia’s Q2 capital expenditure figures point to a slowdown in the mining boom as authorities down-under have recently suggested. Commodity exporters are starting to feel the pain of the sudden fall in Chinese demand for raw materials. Commodity stocks are piling up in China’s warehouses.