March to new lows

By GG Analyst in Reviews 0 Comment

EUR/USD

Let’s have a bit of practice in the political logic. Germany asserts that without the fiscal compact it’s pointless to speak about any large-scale support measures in regard to the suffering countries. But the other day these very suffering countries suggested a closer integration than that pointed out by Germany. As is known, Merkel turned down this run of events: “only over my dead body”. What conclusion can we draw up? Only one – Germany is not at all eager to give any help, doesn’t aim at closer integration and doesn’t stand up for the preservation of the eurozone in its more…

USD again gains strength on bad news from the USA

By GG Analyst in Reviews 0 Comment

EUR/USD

The negative sentiments in regard to the USA can cause both decrease and increase in the dollar. It depends just on how much bad news is released. If there isn’t much negative, the CB and the government are expected to handle this by making monetary or fiscal policy less tough. However, if the market believes that the slowdown will spread to other economies and require more money infusions (meaning that it will lead to the increase in the deficit budget), the negative news from the USA can be of benefit to the dollar. The market simply considers that in other countries more…

Small Twist

By GG Analyst in Reviews 0 Comment

EUR/USD

The Fed managed to surpass the market expectations. Yesterday the FOMC announced that it would purchase the Treasury securities with remaining maturities of 6 years to 30 years and sell or redeem an equal par value of Treasury securities with remaining maturities of approximately 3 years or less. There is about $267bln of such bonds on the Fed’s balance. The first round of the programme consists in the redemption of 400bln and was to be finished by July. Yesterday’s decision is accounted for by a rather weak economic dynamics over the last few months: job growth has slowed down, spending has more…

EUR is heading for the lower depths, but who will have the courage to buy it?

By GG Analyst in Reviews 0 Comment

EUR/USD

The ECB calls for politicians to develop a new investment guarantee mechanism at the EU-wide level in order to eliminate an adverse effect, which capital shifts within the region are now producing on some banks. In their turn, the politicians keep emphasizing that the ECB has to take a more active part in bailing out of the troubled countries. While chief officials are shifting responsibility on each other and dictating others what to do, the EU countries keep falling on the domino principle, and the single currency is hitting new lows against the dollar and yen. Yesterday there was an attempt more…

Due south

By GG Analyst in Reviews 0 Comment

EUR/USD

It didn’t take much time for the market participants to rebalance their positions, and yesterday the common currency was again pushed down to new local lows. This time it was much easier to break through the defence line, once really strong at 1.2620. Last week the attempt was foiled just like in January 2012 and at the end of August 2010. The talks of the EU politicians about the development of the Greek exit plan tipped the scale. Earlier from February till the end of April the consolidation was mainly held within the corridor above 1.30 and below 1.34. Something like more…