Morning Market Update – Worry for Greenback

The People’s Bank of China (PBOC) set the Yuan reference rate at 6.8833 versus yesterday’s fix of 6.8673. The PBOC Deputy Governor Yi Gang said that “We have to work on removing existing barriers for the internationalization of the renminbi so that we can make the renminbi a freely useable currency.” The PBOC is expected to provide an effective service for offshore renminbi transactions, which includes a user-friendly payment interface and issuance of license to foreign institutions.

Later for the day, we have the Public Sector Net Borrowing showing positive signs with forecasts at 1.5B versus the previous release which was seen at 1.1B.  This should boost the pound since they have remained silent since yesterday.

The S&P/Case-Shiller Home Price Indices release seems to have remained the same when compared to the previous release. The number of New Home sales released by the US Census Bureau looks to have a major impact for the greenback today and are forecasted at a negative 0.5% against a previous 6.1%. This causes worry for the greenback. The New Home Sales (MoM) is not helping the dollar and looks to take the dollar further down as the forecasted rate has fallen by 0.585M against a previous 0.592M.

 
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