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Dollar Lifts, Euro Dips, the IMF Gets Gloomy...

Thursday, October 11, 2012 3:51 AM GMT

  Good Morning,


- Dollar Lifts, Euro Dips, the IMF Gets Gloomy. The IMF warned in a new report that the euro zone is at risk of a "downward spiral of capital flight, breakup fears and economic decline." U.S. stocks fall on earnings; Alcoa weighs on Dow, S&P 500 ends lower for fourth consecutive trading session.

 Despite  warm words and hand-shakes between Merkel and Samaras, the euro was clearly not convinced that all is rosy in Euroland ….


- Leaders' stuttering progress in addressing the euro zone crisis put pressure on Spanish and Italian bonds, and sent the euro lower. Moreover, corporate earnings weigh on risk, therefore the concerns about corporate earnings dampened risk appetite, and the USdollar held near a one-month high (1,2825)


- S&P lowered Spain's long-term credit rating to 'BBB-' from 'BBB+' (one level above junk on risks) and cut its short-term credit rating to 'A-3' from 'A-2'.


- BOE policy maker Weale says U.K. could have a tripple-dip recession.


- Asian stocks were mixed to lower on Thursday after Standard & Poor's downgraded Spain's ratings, while Japanese machinery orders disappointed.Hong Kong's Hang Seng Index was up 0.09%, Australia's S&P/ASX200 was down 0.17%, while Japan’s Nikkei 225 Index was down 0.18%.


-GBP/USD eases off 1-month low but upside limited. The pound pulled back from a one-month low against the U.S. dollar on Wednesday, but gains looked likely to remain limited amid ongoing concerns over the weak U.K. economy and uncertainty over prospects of a bailout for Spain.


- Crude oil futures traded erratically in U.S. trade Wednesday as investors focused on escalating tensions between Syria and Turkey and the possibility that Iran could support Syria in such a dispute.


- Gold prices fell in Asian trading on Wednesday after traders snapped up the precious metal's hedge, the dollar, amid a risk-off session marked by IMF cuts to global growth forecasts.


- Yuan hits record high as PBOC signals tolerance of appreciation. The yuan strengthened against the dollar on Thursday, briefly hitting an intraday record high after the People's Bank of China (PBOC) set its yuan midpoint stronger than expected, signaling it may tolerate slight appreciation of the currency, traders said


- Fed’s Beige Book released   Overall economic activity expanded “modestly”; Manufacturing and housing improved, while employment remained little changed > USD neutral.


-The U.S. dollar fell slightly against most its major currency counterparts in the initial minutes after the release of the Fed Beige Book.


- Fed's Fisher says monetary policy cannot achieve the goals for job growth officials want


- IMF's Lipton: need monetary action on euro zone allow fiscal adjustments


- ECB's Constancio: world can be encouraged by Europe's progress


- ECB's Noyer says weak banks hurting ECB monetary transmission


- Fed's Yellen: Unwind Assets in Timely Way to Avoid Inflation


- Alcoa Cuts Global Aluminum Forecast on China Slowdown


- Brazil cuts benchmark lending rate by 25 basis points to 7.25%. Also, Brazil Central Bank says global situation remains 'complex' and for that case, low rates for 'prolonged time' is best strategy.


 - RBA's Ellis says financial stability requires wisdom, willingness to act and Australia has key elements to ensure financial stability.


- AUD/USD rises after Australian consumer sentiment data.The Australian dollar rose against its U.S. counterpart on Wednesday, after upbeat Australian consumer sentiment data, although global growth concerns continued to weigh on market sentiment. 


-NZD/USD little changed as growth concerns persist. Markets were also jittery amid uncertainty over when Spain will request a sovereign bailout and when Greece will agree with its international lenders on terms for the next tranche of funds. 


- Shirakawa says the global economy is very unstable, says she's mindful of impact of monetary policy on other nations.


 Have a nice day !

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