2nd Quarter 2009 corporate earnings season
Week ending 10 July 2009: With the onset of 2Q 2009 corporate earnings season, risk aversion returned to financial markets, giving the safe-haven currencies a small lift. Commodities fell, taking growth currencies with them.
The RBA left interest rates steady at 3.0% but emphasized downside economic risks. June unemployment ticked up to 5.8% with 21.4K jobs lost as job advertisements fell −6.7% m/m. July Westpac consumer confidence rose 9.3%, consumer inflation expectations 3.2%, and June AiG Performance of Construction index fell to 42.6. AUD/USD fell and held beneath the bottom of its current range, closing at 0.7784, its lowest level since 28 May 2009.
U.S. May trade deficit narrowed to US$26.0Bn and May consumer credit tightened by $3.2Bn. June ISM services improved to 47.0, although July University of Michigan confidence fell to 64.6.
Eurozone 1Q2009 GDP was revised slightly lower to −4.9% y/y and July Sentix investor confidence fell to −31.3; however, May German factory orders rose 4.4% m/m and industrial production 3.7%. EUR/USD slid into the bottom of its current range on the risk aversion theme, closing at 1.3948, and EUR/AUD also returned to late May levels, closing at 1.7911.
The BoE held both their rates and quantitative easing programme steady. The June NIESR estimate of GDP printed −0.4% from −1.3% previous, while June PPI printed −11.0% y/y input, −1.2% y/y output, and 0.1% y/y output core and Nationwide consumer confidence rose to 58. May industrial production fell −0.6% m/m, −11.9% y/y, manufacturing production −0.5% m/m, −12.7% y/y. The May visible trade balance printed a deficit of £6263Bn, and June Halifax house prices fell −0.5% m/m, −15.0% y/y. GBP/USD fell as low as 1.5983, below the psychologically important 1.60 level, before recovering to close at 1.6205, while EUR/GBP bounced above and below the pivotal 0.8600 level, closing at 0.8604.
Canada’s June unemployment rate rose to 8.6% with 7.4K jobs lost. The May new housing price index fell −0.1%, May building permits surged 14.8%, and June housing starts rose to 140.7K. June Ivey PMI bounded to 58.2, smashing market expectations. USD/CAD continued a slight uptrend, closing at 1.1643, also an important level, while AUD/CAD fell sharply but could not hold below its 200-MA, bouncing from it as support on four-hour charts to close at 0.9063.
In a light data week, the New Zealand 2Q2009 NZIER surged to −25 from −65. NZD/USD held at the lower edge of its current range, closing at 0.6272, and AUD/NZD fell sharply to close at 1.2399.
Japan’s May leading index rose to 77.0, the coincident index to 86.9. The Eco Watchers survey rose to 42.2 current, 45.6 outlook, and the May trade balance widened to a surplus of ¥387.3Bn, the current account total to ¥1301.8Bn. May machine orders are down −38.3% y/y, June machine tool orders −73.1%. The yen ruled markets this forex trading week, with USD/JPY falling 3.8%, touching 91.76 to complete the head and shoulders chart formation, and closing at 92.39. EUR/JPY fell 4.1%, AUD/JPY 6.5% as investors shed risky assets, with the losses consolidating through the week. EUR/JPY closed at 128.90, below the 130.60 swing level, and AUD/JPY closed at 71.93, below the important 73.00 level.
Week ending 10 July 2009
With the onset of 2Q2009 corporate earnings season, risk aversion returned to financial markets, giving the safe-haven currencies a small lift. Commodities fell, taking growth currencies with them.
The RBA left interest rates steady at 3.0% but emphasized downside economic risks. June unemployment ticked up to 5.8% with 21.4K jobs lost as job advertisements fell −6.7% m/m. July Westpac consumer confidence rose 9.3%, consumer inflation expectations 3.2%, and June AiG Performance of Construction index fell to 42.6. AUD/USD fell and held beneath the bottom of its current range, closing at 0.7784, its lowest level since 28 May 2009.
U.S. May trade deficit narrowed to US$26.0Bn and May consumer credit tightened by $3.2Bn. June ISM services improved to 47.0, although July University of Michigan confidence fell to 64.6.
Eurozone 1Q2009 GDP was revised slightly lower to −4.9% y/y and July Sentix investor confidence fell to −31.3; however, May German factory orders rose 4.4% m/m and industrial production 3.7%. EUR/USD slid into the bottom of its current range on the risk aversion theme, closing at 1.3948, and EUR/AUD also returned to late May levels, closing at 1.7911.
The BoE held both their rates and quantitative easing programme steady. The June NIESR estimate of GDP printed −0.4% from −1.3% previous, while June PPI printed −11.0% y/y input, −1.2% y/y output, and 0.1% y/y output core and Nationwide consumer confidence rose to 58. May industrial production fell −0.6% m/m, −11.9% y/y, manufacturing production −0.5% m/m, −12.7% y/y. The May visible trade balance printed a deficit of £6263Bn, and June Halifax house prices fell −0.5% m/m, −15.0% y/y. GBP/USD fell as low as 1.5983, below the psychologically important 1.60 level, before recovering to close at 1.6205, while EUR/GBP bounced above and below the pivotal 0.8600 level, closing at 0.8604.
Canada’s June unemployment rate rose to 8.6% with 7.4K jobs lost. The May new housing price index fell −0.1%, May building permits surged 14.8%, and June housing starts rose to 140.7K. June Ivey PMI bounded to 58.2, smashing market expectations. USD/CAD continued a slight uptrend, closing at 1.1643, also an important level, while AUD/CAD fell sharply but could not hold below its 200-MA, bouncing from it as support on four-hour charts to close at 0.9063.
In a light data week, the New Zealand 2Q2009 NZIER surged to −25 from −65. NZD/USD held at the lower edge of its current range, closing at 0.6272, and AUD/NZD fell sharply to close at 1.2399.
Japan’s May leading index rose to 77.0, the coincident index to 86.9. The Eco Watchers survey rose to 42.2 current, 45.6 outlook, and the May trade balance widened to a surplus of ¥387.3Bn, the current account total to ¥1301.8Bn. May machine orders are down −38.3% y/y, June machine tool orders −73.1%. The yen ruled markets this forex trading week, with USD/JPY falling 3.8%, touching 91.76 to complete the head and shoulders chart formation, and closing at 92.39. EUR/JPY fell 4.1%, AUD/JPY 6.5% as investors shed risky assets, with the losses consolidating through the week. EUR/JPY closed at 128.90, below the 130.60 swing level, and AUD/JPY closed at 71.93, below the important 73.00 level.
