Analysis and Recommendations: The EUR/USD declined to trade at 1.3222 losing 16pips. Markets remain worried about the US Fiscal Cliff, with President
Analysis and Recommendations:
The EUR/USD declined to trade at 1.3222 losing 16pips. Markets remain worried about the US Fiscal Cliff, with President Obama summoning Congressional Leaders to the White House, to push negotiations forward. Headline risk is likely to remain a driver of FX markets in the near term, as evidenced by yesterday’s response to comments from Senate Majority Speaker Reid and subsequently news of a House session planned for December 30th. Markets have responded, with measures of risk retracing their early 2012 declines.
The euro is weaker, down 0.5%. Headlines out of the US will likely continue to impact movement in the near term though market reactions to news of sovereign debt auction results and issuance schedules have also impacted EUR over the past two European sessions.
The euro declined as traders sold off to take profits ahead of year end as the euro was at recent highs. Although analysts partly attributed the euro’s drop to year-end dollar demand and thin liquidity, they said unwinding of long euro positions were weighing on the currency.
The euro has trended higher since mid-November, gaining around 5 percent in a month to hit an 8-1/2 month high of $1.33085 on Dec. 19 as worries around the euro zone crisis eased.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports
Markets will have a shortened day on Monday December 31st and most are closed on Tuesday January 1, 2013. Our analysis will be published as markets close on Monday and there will be no analysis on Tuesday. I want to wish all of my readers a happy and healthy new year. I hope you continue reading our analysis next year.
Economic Data December 28, 2012 actual v. forecast
Date |
|
Currency |
|
|
Event |
Actual |
|
Forecast |
|
Previous |
|
|
Dec. 28 |
|
EUR |
|
|
French Consumer Spending (MoM) |
0.2% |
|
0.1% |
|
-0.1% |
||
|
|
EUR |
|
|
French GDP (QoQ) |
0.1% |
|
0.2% |
|
0.2% |
|
|
|
|
SEK |
|
|
Swedish Retail Sales (MoM) |
0.30% |
|
0.20% |
|
-1.80% |
||
|
|
EUR |
|
|
Italian 10-Year BTP Auction |
4.48% |
|
|
|
4.45% |
|
|
|
|
USD |
|
|
Chicago PMI |
51.6 |
|
51.0 |
|
50.4 |
|
|
|
|
USD |
|
|
Pending Home Sales (MoM) |
1.7% |
|
1.0% |
|
5.2% |
|
Upcoming Economic Events that affect the CHF, EUR, GBP, CAD and USD
Date |
Time |
Country |
Event |
Forecast |
Previous |
Jan. 01 |
01:00 |
CNY |
|
50.60 |
|
Jan. 02 |
00:00 |
EUR |
0.7% |
-0.1% |
|
|
00:00 |
EUR |
1.9% |
1.9% |
|
|
08:00 |
CHF |
1.38 |
1.50 |