Forex – Yen Gains On Weak Export Data, Virus Fears; Yuan Drops

© Reuters.  © Reuters.

By Alex Ho

Investing.com – The Japanese yen gained on Thursday in Asia gained on Thursday in Asia amid weak export figures and fears about the mysterious virus in China.

The EUR/USD pair inched down 0.1% to 1.1082 as traders awaited the European Central Bank (ECB) policy meeting due later in the day. The meeting will be followed bya press conference with President Christine Lagarde.

The USD/JPY pair lost 0.3% to 109.53 amid ongoing fears about the widening coronavirus outbreak, as authorities ramped up efforts to contain the virus ahead of the weeklong Lunar New Year holiday next week.

The World Health Organisation will decide later on Thursday whether to declare the situation a global health emergency.

On the data front, Japanese exports for December fell 6.3% in December as compared to a year before, data from country’s Ministry of Finance data showed. That was far lower than the expected 4.2% decrease.

The USD/CNY pair lost 0.4% to 6.9283.

The Australian dollar rose 0.2% to 0.6858 after a surprise drop in unemployment.

Meanwhile,the U.S. dollar index that tracks the greenback against a basket of other currencies last traded at 97.335, up 0.04%.

The index traded higher overnight after the National Association of Realtors said pending home sales rose 3.6% to a 5.54 million annual rate. That was the strongest pace of growth since February 2018.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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NZ – BusinessNZ Manufacturing PMI for December drops to 49.3 (prior 51.4)

NZ data, PMI back into contraction and the lowest since Sep of last year. 

BusinessNZ’s executive director for manufacturing Catherine Beard

  • “The manufacturing sector averaged 50.9 over 2019, compared with 53.8 for 2018 and 56.2 for 2017.  While the first half of the year managed to just keep its head above water, the second half saw four of the six months in contraction.”

BNZ Senior Economist, Craig Ebert

  • “the December result was disappointing.  After a couple of months flirting with positivity, the PMI dipped back just below the breakeven line again”
NZ data, PMI back into contraction and the lowest since Sep of last year. 

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China’s yuan gains after U.S. drops China FX manipulator label

By Yoruk Bahceli

LONDON (Reuters) – China’s yuan climbed to its highest level since July on Tuesday and the Japanese yen plumbed eight-month lows as the U.S. Treasury Department reversed its decision in August to designate China as a currency manipulator.

The Treasury Department’s new report on currency manipulators could help explain the reason for the Swiss franc surging to a 33-month high against the euro, some analysts said. [L8N29J36G] Washington included Switzerland on a watchlist, although other market participants said it had been expected and broader safe-haven flows were behind the franc’s move.

The announcement on the yuan came as Chinese Vice Premier Liu He arrived in Washington ahead of Wednesday’s signing with U.S. President Donald Trump of a preliminary trade agreement aimed at easing tensions between the two countries.

“Washington’s decision to lift its designation of currency manipulator on China has added to the positive mood that has been already in place ahead of the signing of the trade deal,” said Minori Uchida, chief currency strategist at MUFG Bank.

People familiar with the negotiations said its removal was an important symbol of goodwill for Chinese officials.

China has also pledged to buy almost $ 80 billion of additional manufactured goods from the United States over the next two years as part of a trade war truce, according to a Reuters source.

The dollar rose as much as 0.3% against the Japanese yen to 110.22 yen , its highest since late May versus a currency that tends to weaken when investors are buoyant. It last stood at 109.97 yen.

In onshore trade, the yuan strengthened to as high as 6.8731 per dollar , its strongest since late July. China’s central bank set the midpoint of the yuan’s daily trading band at 6.8954 per dollar on Tuesday, its strongest fixing since Aug. 1.

The also firmed to its strongest level in six months, hitting 6.8662 yuan before easing off .

Chinese forecast-beating trade data also helped to boost optimism about the economy and the yuan.

Despite the optimism, some analysts said there were signs of a bid for safety.

The Swiss franc rose to its strongest since April 2017 at 1.0763 against the euro (), up nearly 0.5%. It rose 0.4% versus the dollar .

Some analysts said this reflected nervousness, as risky emerging market currencies such as the South African rand and Turkish lira fared poorly.

“The interesting question is how long can this optimism last, how much further can it go. A lot surely has to be in the price,” said Jane Foley, senior FX strategist at Rabobank.

“If we were to get another rise in tensions between the U.S. and China and if we were to turn our attention to phase two (of the trade deal)… it’s very likely that we will see the renminbi falling again,” Rabobank’s Foley said, adding that the currency might face a low at the 7.18 level hit in September.

In Europe, sterling weakened further on Tuesday, hitting a seven-week low against the euro at 85.95 pence before recovering. ()

The currency has come under pressure from weak data releases, raising the chances of a cut to interest rates by the Bank of England. Money markets forecast an almost 50% probability of a cut at a meeting on Jan. 30.

The euro was mildly supported by risk-on sentiment, remaining off a two-week low of $ 1.10855 () hit on Friday, last trading at $ 1.1124.

The gained 0.1% to 97.43 ().

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Wall Street drops 2% on U.S. growth concerns

© Reuters. Traders work on the floor at the NYSE in New York © Reuters. Traders work on the floor at the NYSE in New York

By Medha Singh and Arjun Panchadar

(Reuters) – Wall Street’s main indexes were on course for their sharpest drop in nearly six weeks on Wednesday as a clutch of recent data, including a report on private sector hiring, suggested that trade tensions were taking a toll on the U.S. economy.

All the 11 major S&P sectors were in the red, with technology shares () taking the biggest hit after tumbling 2.4%. Sectors, including industrial (), materials (), energy () and financials (), also shed more than 2%.

The ADP (NASDAQ:) National Employment Report showed private payrolls growth in August was not as strong as previously estimated, and said “businesses have turned more cautious in their hiring,” with small enterprises becoming “especially hesitant.”

The report comes a day after U.S. factory activity contracted to its lowest level in more than a decade, triggering sharp falls in U.S. stocks indexes.

The recent set of weak data has shaken investor faith in the strength of the domestic economy, which had shown relative resilience in the face of slowing global growth and was a key reason for a rally in the benchmark index this year.

“People have been anticipating a bear market for years and they are very anxious and so any number like the ADP number is amplified in the volatility on the downside,” said Tom Plumb, chief investment officer at Plumb Funds in Madison, Wisconsin.

The focus is now on the Labor Department’s more comprehensive jobs report due on Friday for further clues on the health of the U.S. economy.

“The hardest part to figure out is whether trade and the business recession will impact consumer confidence and that leads to a very different scenario,” said Phil Blancato, chief executive officer of Ladenburg Thalmann Asset Management in New York. “So far it hasn’t happened … the consumer has held up.”

The S&P 500 () and the Dow () slipped below their 100-day moving averages for the first time in about a month on Wednesday, seen as a strong technical support level that could presage further losses.

Graphic: Wall Street’s main indexes hit 1-month lows – https://fingfx.thomsonreuters.com/gfx/buzzifr/14/7661/7661/SPX.png

The benchmark index is now about 5% below its all-time high hit in July, after coming within striking distance of the mark two weeks ago.

At 13:02 ET (1702 GMT), the Dow Jones Industrial Average () was down 563.16 points, or 2.12%, at 26,009.88 and the S&P 500 () was down 61.04 points, or 2.08%, at 2,879.21. The Nasdaq Composite () was down 152.02 points, or 1.92%, at 7,756.66.

The Cboe Volatility Index, or VIX (), an options-based gauge of investor anxiety, rose 2.50 points to 21.06, its highest in about a month.

Activision Blizzard Inc (O:) dropped 3.3% after Bernstein downgraded the videogame maker’s shares to “market perform”.

Ford Motor Co (N:) shares fell 4.3% after the carmaker reported a fall of about 5% in U.S. auto sales for the third quarter. Shares of General Motors Co (N:) dipped 4.3% ahead of its quarterly auto sales report.

Among bright spots, homebuilder Lennar Corp (N:) rose 2.4% after the company reported a better-than-expected profit as cheaper mortgage rates led to higher demand for its homes.

Johnson & Johnson (N:) gained 1.2% after the drugmaker said it will pay $ 20.4 million to settle claims by two Ohio counties, allowing it to avoid an upcoming federal trial seeking to hold the industry responsible for the nation’s opioid epidemic.

Declining issues outnumbered advancers for a 4.61-to-1 ratio on the NYSE and a 3.22-to-1 ratio on the Nasdaq.

The S&P index recorded three new 52-week highs and 12 new lows, while the Nasdaq recorded four new highs and 167 new lows.

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Forex – U.S. Dollar Drops as Data Supports Fed Rate Hike Pause

Investing.com – The U.S. dollar drifted lower on Wednesday as economic data stateside reinforced the Federal Reserve’s current neutral stance on interest rates, while currency pairs moved on economic and political news abroad.

At 11:30 PM ET (15:30 GMT), the , which measures the greenback’s strength against a trade-weighted basket of six major currencies, dropped 0.21% to 96.70.

Producer prices in the U.S. rose only marginally in February, showing a similar increase to the consumer price index and adding to signs that inflationary pressure was muted.

Durable goods orders did show the strongest growth in six months in January, but were insufficient to change the outlook that the American economy has been losing momentum in the first part of the year.

Subdued inflation and slowing growth provides little impetus for Fed Chief Jerome Powell to change his promise that the central bank would maintain a “patient, wait-and-see approach”.

The U.S. dollar was generally weaker across the board on Wednesday with most of the focus on .

The pound received a boost as the U.K. parliament once again rejected British Prime Minister Theresa May’s deal with the European Union.

The British parliament will hold another vote at around 3:00 PM ET (19:00 GMT) in which it is expected to shut down any possibility of the U.K. leaving without a deal, which would likely lead to a proposal for the March 29 deadline to be delayed.

The also traded higher against the greenback after economic data showed stronger-than-expected industrial production for the eurozone in February.

To the contrary, the was under pressure as a reading of consumer confidence hit its lowest level in more than a year in March. The , tightly linked to the Aussie, also headed lower against the American currency.

The Japanese yen showed little movement with trading unchanged at 111.34.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Forex – Sterling Drops as UK Growth Slows Sharply on Brexit Worries

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Investing.com – The British pound fell to the lows of the day on Monday after data showing that Britain’s economy slowed sharply in the final three months of 2018 amid concerns about the impact of Brexit.

was down 0.36% to 1.2899 by 05:03 AM ET (10:03 AM GMT) from around 1.2931 earlier.

The Office for National Statistics reported that slowed to in the three months to December from 0.6% in the previous quarter. This was below forecasts of 0.3% and slightly weaker than the Bank of England estimated last week.

“GDP slowed in the last three months of the year with the manufacturing of cars and steel products seeing steep falls and construction also declining,” ONS statistician Rob Kent-Smith said.

For 2018 as a whole, growth dropped to its lowest since 2012 at 1.4%, from 1.8% in 2017.

Exports were hit by global weakness and consumers and businesses grew increasingly concerned about the lack of a plan for when Britain is due to leave the European Union on March 29.

Last week the BoE cut its forecast for growth this year to 1.2%, which would be the weakest since the 2009 recession.

In December alone, the economy contracted by , the largest drop since March 2016.

With less than seven weeks before the Brexit deadline, British Prime Minister Theresa May has for the withdrawal agreement she agreed with Brussels.

The euro rose to the day’s highs against sterling, with adding on 0.21% to trade at 0.8761.

— Reuters contributed to this report

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Forex – Aussie Drops on RBA Forecast Cut; U.S. Dollar Edges Up

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Investing.com – The Australian dollar fell against the U.S. dollar on Friday in Asia after the Reserve Bank of Australia (RBA) slashed its GDP growth forecast for the year through June.

In its quarterly statement on Monetary Policy today, the central bank cut the GDP growth forecast to 2.5% from the previous 3.25%.

For the year to June 2020, the RBA cut its projection to 2.75% from 3.25% and sees 2021 growth at 2.75%. Unemployment is seen at 5.0% through 2019, unchanged from its current level.

On inflation, the headline CPI forecast was cut to 1.25%.

The pair fell 0.3% to 0.7077 following the news. The Australian currency has now shed 2.4% of its value so far this week.

Meanwhile, the U.S. dollar traded near a two-week high, supported by safe-haven demand, after President Donald Trump said this week he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline to achieve a trade deal.

White House economic advisor Larry Kudlow warned that there is a “pretty sizable distance to go” before China and the U.S. could reach an agreement, while Treasury Secretary Steven Mnuchin also noted this week that “wide range of issues” remains to be worked out.

China and the U.S. have until the start of March to strike a trade deal before additional tariffs on Chinese imports kick in.

The that tracks the greenback against a basket of other currencies last traded at 96.345, up 0.1%.

Elsewhere, the pair edged down 0.08% to 109.70.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Martin Lewis drops Facebook legal action

Consumer campaigner Martin Lewis has dropped his legal action against Facebook over a series of ads that ran on its platform, falsely claiming he backed several investment schemes.

The MoneySavingExpert website founder had claimed the fake endorsements had caused him reputational damage.

He said he had dropped the case because Facebook had agreed to introduce a scam ads reporting button.

As part of the deal, Facebook will also give £3m to Citizens Advice.

The organisation will use the money for a scheme to identify and fight online scams and support their victims.

The project is set to launch in May.

It will include work to develop tools to help the public identify such fraudulent activity.

Facebook’s investment will be made over a three-year period and consist of £2.5m in cash and a further £500,000 worth of advertising credit.

“The amount being donated to set up the Citizens Advice scams action project is far above anything I could’ve won had I succeeded in a court,” Mr Lewis said in a statement.

“The aim of my campaigning lawsuit was always to stop scam ads and to help those who have fallen victim to them.

“What we’re announcing today does that at a far bigger scale than I could’ve hoped for.”

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Mr Lewis announced his decision at a joint press conference with Facebook in London, which was live-streamed on Facebook.

He said that more than 1,000 bogus adverts had appeared on Facebook bearing his image and/or name.

Some of these had pictured him giving advice on ITV’s This Morning programme, while others bore the BBC logo as part of efforts to give the schemes credibility.

Several claimed to involve crypto-currency speculation but Mr Lewis said they were often fronts for binary trading companies based outside of the EU, which the public would be ill advised to get involved with.

The Financial Conduct Authority (FCA) has warned consumers to be wary of binary option trading, saying it is a form of fixed-odds betting that typically results in losses.

Facebook had initially defended its role, saying it would deal with any ads brought to its attention that infringed Mr Lewis’s rights.

But the campaigner accused the US company of being ineffective due to its reliance on user reports.

At Wednesday’s press conference, however, Mr Lewis said that after he had threatened to sue Facebook, the company had “quickly realised the scale of the problem” and agreed to commit resources to tackle the issue.

Facebook’s new scam ad reporting button promises to make it easier for users to flag promotions they suspect to be scams.

The tech firm has pledged to support the service with a “dedicated internal operations team” whose job it will be to investigate the reports as well as to proactively identify related ad trends that amount to an abuse of its platforms.

Facebook’s regional director for northern Europe, Steve Hatch, said: “We’re grateful to Martin Lewis for bringing attention to this important issue and for his guidance over the last eight months.”

Mr Lewis added that he hoped Google and other advertising platforms would also accept they needed to make improvements and should “put their hands in their pockets” to support Citizen Advice’s work.

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Forex – Sterling Drops as UK and Spain Fail to Reach Deal Over Gibraltar

© Reuters.  © Reuters.

Investing.com – The pound was lower on Friday after r after the UK leaves the European Union.

slipped 0.38% to 1.2828 as of 7:17 AM ET (12:17 GMT).

“My government will always defend the interests of Spain,” Spain Prime Minister Pedro Sanchez wrote on Twitter Thursday night.

Spain previously threatened to veto the draft Brexit agreement scheduled for a vote on Sunday if the two nations could not reach an agreement on over the UK territory.

The Rock, as it’s known by, presents one of many challenges on the deal. The Spanish have asked that the UK provide a solution to the thousands of Spanish workers that cross the border every day.

The euro was also lower, as signs pointed to slowing economic growth in the euro zone. fell 0.44% to 1.1352.

Euro zone business growth slowed much faster than expected this month, according to data from the (PMI) survey.

The numbers are likely to be of concern to the European Central Bank, which is expected to slow down its asset purchasing program in December.

Meanwhile, the , which measures the greenback’s strength against a basket of six major currencies, rose 0.14% to 96.722.

Trading in the U.S. is expected to be thin, as markets were closed for the Thanksgiving holiday on Thursday. Stock markets will close at 1:00 PM ET (18:00 GMT) and the bond markets close at 2:00 PM ET.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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