EUR clings to 1.2500

By GG Analyst in Reviews 0 Comment

EUR/USD

Euro-bears almost reached the preceding lows in the pair. EURUSD dropped down to 1.2456 during the day, yet the weekly low of 1.2437 was left untouched. While the morning weakness could be accounted for by the disappointing rates of the EU Final PMIs, the pair’s recovery during the US session could hardly be explained by any fundamental factors. But let’s relate everything in due order. The Services PMI and Composite PMIs for Italy and France proved to be in the green zone, besides the Italian activity in the services sector even became more intense in comparison with the previous month, which more…

USD makes a step back before FOMC’s meeting

By GG Analyst in Reviews 0 Comment

EUR/USD

The Ifo Business Climate Index dropped in October more than expected. The general index fell from 104.7 to 103.2, while only 104.6 had been expected. The Ifo Current Assessment and Expectations again declined simultaneously, to 108.4 and 98.3 from 110.5 and 99.3 respectively. The current rates are the lowest since the end of 2012. Investors tend to believe that in the second half of the year Germany will fall into technical recession, i.e. will suffer reduction of the GDP for at least two quarters in a row. Yet, it should be taken into account that the country has the strong beginning more…

Cautious optimism to follow the stress tests

By GG Analyst in Reviews 0 Comment

EUR/USD

25 EU banks failed the ECB’s stress tests, carried out at the end of the previous year. The regulator, anyway, notes that over that time the banks have improved their financial health. The Italian banks are in the worst position – there 9 banks failed the ECB’s checks and 2 banks need to build up the capital. Altogether the banks have to increase the capital by €25bln, half of which has already been gained by the banks by now. Though the results didn’t show a sudden improvement of the banking system, market observers and participants took the results with cautious optimism more…

EUR suffers losses in the period of the market appreciation

By GG Analyst in Reviews 0 Comment

EUR/USD

Yesterday the single currency fell under pressure after Reuters’ message that the ECB could start purchasing corporate bonds already in December. That news deprived the euro of about 0.7% and pushed EURUSD down to 1.2700. Formally this level held out , but it seems to be just a question of few days, when the single currency will continue its downward movement. Investment banks have already hastened to announce the end of the correction and the beginning of a new downward trend with the targets at 1.25 and in the longer term at 1.20. Weidmann, Bundesbank President and the main oppositionist of more…

China supports optimism of the markets

By GG Analyst in Reviews 0 Comment

EUR/USD

Yesterday the ECB purchased French BTFs, this way starting QE in its region. Of course, yesterday’s fluctuations couldn’t put any significant impact on the market, but they were quite able to change the mood of its participants. It didn’t happen though. Traders were purchasing the single currency. They keep doing it now as well, hoping that these measures will contribute to quicker recovery of the eurozone. Since the beginning of 2013 the ECB’s balance has been shrinking as banks were allowed to return loans, issued earlier within the LTRO programme. These returns have cut the CB balance by about a third, more…