Forex-Metal Daily Analysis - 16/07/10

Forex-Metal

Master Trader
Jul 12, 2010
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The released China’s second quarter report results supported the negative market sentiments.

Asian, European and American trading sessions.
Japanese Yen: According to the expectations, the Bank of Japan left the principal rate unchanged at the level of 0,1%. In addition, the released statement of the Bank of Japan referred to its intentions to continue with the soft monetary policy.
The Japanese yen rate grew as the concerns over the slow-down of the US economy rehabilitation rate increased.
The USD/JPY pair dropped below the Y88,00 level.
Euro: The EUR/USD pair traded in the range of $1,2710-$1,2765.
As the investors turn away from the safe-haven currencies, the Euro extended its growth and advanced to its two-month maximum of $1.2834. One o of the reasons was the successful Spanish debt auction results.
US Dollar: The minutes of the FRS meeting, which was released yesterday, continued to pressure the US dollar rate on Thursday. According to the published protocol, the FRS decreased the GDP forecasted growth rate and mentioned the existing risk growth in the US economy.
Another negative impact on the investors’ attitudes came from the release of China’s second quarter GDP report, which dropped to 10.3% against the previous level of 11.9%.
In addition, we should mention, that the USD producer price index dropped, the USD Empire manufacturing index decreased considerably and the US Philadelphia Fed. index dropped as well.
British Pound: The GBP/USD rate managed to reach the $1,5280 maximums. Following the shift in the market participants’ risk sentiments and the euro growth during the European session, the sterling increased to $1.5355 mark.
Oil: During the morning trading session, the oil prices were under pressure. The prices showed a minor drop to $76.84 level per barrel.
Australian Dollar: The Australian dollar rate dropped due to the released fundamentals. The consumer inflation expectation decreased to 3.3% from the previous level of 3.4%. Therefore, the expectations for the further principal interest rate increase in Australia dropped.