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Critical Week Ahead: EU Summit , MPC Minutes...

Monday, October 15, 2012 3:43 AM GMT

Good Morning ,

 

- Critical Week Ahead: EU Summit, German Zew, UK Retail Sales, UK CPI, MPC Minutes, busy US data calendar..

- EU wins 2012 Nobel Peace Prize, despite debt crisis. The EU has been a key in transforming Europe "from a continent of wars to a continent of peace," Committee chairman Thorbjoern Jagland said in announcing the award in Oslo. "This is a message to Europe to do everything they can to secure what they've achieved and move forward," Jagland said.

-  Euro edged higher versus dollar and yen on Friday, but lower on the week. The euro managed to close at $1.2951 on Friday, up 0.2 percent on the day, but down 0.6 percent on the week. It has traded in a relatively tight range since mid-September, roughly between $1.28 and $1.3170.

- After hitting a 10-day low at $1.2824 on Thursday, Euro found firm support at its 200-day moving average at $1.2823 and moved upwards.

- Besides technical support, euro recovered after International Monetary Fund said Europe's heavily indebted countries should be given more time to narrow their deficits. Also, data showing output at euro zone factories grew much more than expected in August, added a lot to euro's gains.

-Against the yen, the euro rose 0.3 percent to 101.55 yen. The dollar hit a high of 78.53 yen, recovering from Thursday's 10-day low against the Japanese currency of 77.92 yen.

- The dollar got lifted against yen after data showed a sharp drop in initial U.S. jobless claims last week and news that Japan wireless service provider Softbank Corp may buy a majority stake in Sprint Nextel, in a deal potentially worth at least 1 trillion yen ($12.74 billion).

- On the other hand, dollar showed little reaction to U.S. data showing consumer sentiment unexpectedly rose in October to its highest in five years, while producer prices climbed more than expected in September.

- The Spanish economy minister said on Friday a European bond-buying plan was fully ready for use and that there was no political resistance to a bailout request from within the euro zone.

- Aussiedipped 0.4 percent to $1.0245, retreating from the previous session's one-week high of 1.0294. Still, ‘aussie’ pulled further from a near three-month trough of $1.0149 plumbed a week ago. Immediate resistance is seen around $1.0300, a level that has capped the currency in recent sessions.

-Japan said Saturday it would consider buying bonds issued by Europe's new permanent bailout fund in a bid to help soothe the Euro zone crippling debt crisis. "We will consider buying them after carefully reviewing what Europe itself will be doing" on reforms, Finance Minister Koriki Jojima told a press briefing on the sidelines of the International Monetary Fund and World Bank's annual meetings in Tokyo.

-Commodity currencies like the Australian dollar got off to a mildly positive start in Asia on Monday following an unexpectedly strong bounce in China's exports, while the euro was little changed ahead of yet another summit in the euro zone.

-China, Japan Signal Support for Europe Rescue Fund as IMF Meets. The world’s second- and third-biggest economies, indicated support for Europe’s new rescue fund as they pushed for quick implementation of measures to solve the region’s crisis.

- Shirakawa: International Financial Stability as a Public Good

- Schaeuble Says Europe's Partners See Crisis-Fighting Progress

-  Weidmann Sees German Economy Stagnating in Second Half of 2012

-  IMF Shinohara says BoJ can ease more to achieve inflation target

- Romney extends lead over Obama: Reuters/Ipsos poll

- $USD September Budget Surplus at $75 billion but US Budget Deficitwas $1.09 trillion for fiscal 2012

-  China data b: Trade Balance (Sep) $27.67B vs. $20.54B exp. Exports (Sep) 9.9% y/y vs. 5.5% exp. Imports (Sep) 2.4% y/y, as expected. Foreign Exchange Reserves (Sep) $3290.0B vs. $3228.0B exp, $3240.0B in Aug

- China’s currency has reached its equilibrium rate and its value is mainly set by the market, rather than intervention, Zhou Xiaochuan, the nation’s central bank chief, said Sunday, signaling that major movement in the renminbi’s value is unlikely soon.

-NZ data :  Performance of Services Index fell (first contraction since 2009) to 49.6  in Sep from 50.0 in Aug. On the Calendar: Asian economic events will dominate this week with $NZD and $CNY CPI on Monday, $AUD RBA Minutes on Tuesday, $CNY GDP Thurs

- Fed'sLacker: FOMC communications work should be high priority

- UK House Price Index: This month sees a jump in new seller average asking prices of 3.5% (+£8,310), the biggest increase for eight months.

- CFTC Contracts: Short EUR contracts increase to -72570 contracts from -50265 one week ago ,  Short CHF contracts decrease to -306 from -984 one week ago, an interesting difference from EUR contract changes

 

Have a nice Week  !

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