With emerging market currencies depreciating against the Franc and growing production costs in Switzerland exporters are starting to worry. As the SNB is still holding onto the 1.20 cap against the Euro this year the currency has jumped 14.2% against the Rupiah and 13% against the Lira. These rises have already contributed to large losses in sales such as the $1 billion for the cement company
The change in the number of unemployment claims fell by 33,600 in the UK, surpassing its 29,700 forecast. Additionally, the unemployment rate unsurprisingly dropped to 6.4% from the previous month's 6.5%. However, the average earnings index revealed a downfall of 0.2%. Subsequent to the data release, the Sterling dropped against the Greenback by 0.06%, trading at 1.6802.
In spite of geopolitical tensions in both Ukraine and the Middle East, global oil supplies revealed to be more abundant than expected, causing Brent oil futures to drop to its lowest level in thirteen months. Brent for September sank by 0.36%, trading at 102.65 dollars a barrel. Meanwhile on the NYME, crude for September inched up by 0.05%, trading at
While on the Asian session, gold prices marginally dropped as traders wait for developments regarding European data and geopolitical worries. Yesterday, Germany suggested that the conflict in Eastern Europe could be preventing global economic recovery, increasing demand for safe-haven assets as a result. Gold futures for delivery in December fell 0.05% to trade at 1,310.00.
The US Dollar remained steady against the Japanese Yen after the release of Japan's GDP data. During the second quarter the real GDP decreased by 6.8%, revealing to be less than the 7.1% forecast. Earlier this day, the Greenback rose from 102.25 to 102.28 against the Yen.
The common currency remained steady versus the US Dollar just above its lowest level in nine months. Traders are still cautious while they focus on Euro zone's data regarding inflation and economic growth, due to be released on Thursday. The Euro traded at 1.3371 against the US Dollar, close to its lowest level in nine months at 1.3332.
China's industrial and fixed-asset investment growth was lower, which could add to the worries about its economic recovery. With the industrial output growing 9.0% year-on-year in July and fixed-asset investment increasing 17% there could be increased growth risk as the property sector and loans are still worrying. Meanwhile, the Shanghai Composite Index was 0.4% lower after the data.
Japan's economy shrunk by the largest amount since the 2011 earthquake as spending dropped after the sales-tax increase in April. The country's GDP lost an annualized 6.8% in this year's second quarter as household consumption plunged at an annual rate of 19.2% and private investment at 9.7%. Furthermore, the Japanese government plans to raise the tax even further if the GDP recovers.
During the Asian session, gold prices dropped further as tension in both Ukraine and the Middle East eases. However, breaks in geopolitical conflicts are not uncommon, therefore traders are still remaining cautious as the conflict may worsen once again. This caused gold's December delivery futures to decline, trading at 1,309.10 dollars.
As the demand for safe-haven and low-risk currencies eases, a process related to diminishing geopolitical worries, the New Zealand Dollar slipped to its minimal level in two months against the Greenback. The pair dropped to 0.8409, its lowest value since June 4, and proceeded to consolidate at 0.8422. The Kiwi also lost against its Australian counterpart, falling by 0.35% to
The Yen dropped for two days in a row against the US Dollar, falling from its highest level in three weeks. As geopolitical tensions diminish, demand for the Yen as a safe-haven dropped considerably. Against the Greenback it fell by 0.1% trading at 102.27. Meanwhile, the Yen managed to gain against the Euro, trading at 136.74 from 136.78.
Traders are focused on the data scheduled to be released today in regard to Germany's ZEW economic sentiment. The Euro keeps dropping versus the greenback, remaining below the 1.34 level which was broken the day before. The common currency sank by 0.13% to trade at 1.3366 against the Dollar and lingering near its lowest price since November 2013.
As the American Petroleum Institute is about to release a report regarding supply data, the WTI crude fell after rising for three days. Likewise, the Brent also weakened. September delivery, in regard to the WTI, dropped to 97.68 dollars a barrel on the NYME. As for the Brent, September delivery dropped by 0.4% to 104.27 dollars a barrel, sitting near
The Lira rose as Recep Tayyip Erdogan won the first direct presidential election. This will allow the former prime minister to extend his stay in power to 2019. With the Turkish Lira adding 0.3% and reaching 2.1383 per Dollar the currency overall is 0.5% stronger this year. Now the attention for Turkey's economy shifts to its foreign debt and inflation.
The Sterling managed to recover from its lowest level in two months against the Greenback. After being pressured by the possibility of increased rates, the Pound climbed and was able to recover by 0.10% to trade at 1.6789 against the US Dollar ahead of BoE's inflation report due to be released on Wednesday, along with several other indicators and a
With a new ceasefire in Gaza, along with the halting of Russia's military drills near the border, demand for safe-haven assets decreased. As a consequence, gold for December dropped by 0.15% to trade at 1,309.00 an ounce during the early European session. Prices ranged from 1,306.50 and 1,312.80 as traders are still attentive to geopolitical tensions.
After achieving its highest level in one week during the previous session, the Euro decreased below $1.34 this Monday. With geopolitical concerns slowly wearing off, such as Russia ending its drills near the border and the beginning of a new ceasefire in Gaza, the Euro fell by 0.14% to trade at $1.3395 from $1.3432.
As investors keep focused on geopolitical tension, both in the Middle East and Ukraine, crude oil futures fluctuated in between losses and gains this Monday. In London, the Brent's delivery for October dropped by 0.09% to 105.53 dollars a barrel. Meanwhile, on the NYSE, crude for September raised by 0.09%, trading at 97.74 dollars a barrel.
During the second quarter, Europe's leading economy and growth engine shrank by 0.1%, underperforming Spain for the first time in over five years. The Euro zone is having trouble in increasing growth and inflation. Germany contracted for the first time since 2012. However, Bundesbank expects the German economy to grow 1.9% this year.
The Yen declined against the Dollar on Monday as demand for the safe haven asset fell due to lessened geopolitical risk. With Russia ending its military drills close to the border of Ukraine and a new ceasefire starting in Gaza the USD/JPY pair gained 0.1% and was trading at 102.17. Meanwhile, the EUR/USD pair declined 0.1% to 1.3344.
Asian stocks gained after experiencing the largest fall since May. With shares losing due to geopolitical risks last week today the Asian indexes increased substantially. The MSCI Asia Pacific Index added 1.2% and reached 145.84 as it rebounded from the 1.4% drop last Friday. Regional indexes such as Topix and HSI jumped 1.8% and 1.2%, respectively.
The Greenback jumped to trade close to its highest value in three months versus the Loonie due to concerns regarding geopolitical tension in Ukraine and Iraq, and also due to disappointing Canadian employment. The pair hit 1.0963 in the European session and proceeded to consolidate at 1.0959, representing a 0.36% gain.
The Sterling dropped to almost two-month low versus the Greenback today, following the issue of the unsatisfactory trade balance figures, whereas the geopolitical risks kept on fueling the safe-heaven demand. The Cable consolidated at 1.6813 today, sliding 0.11%. The data indicated the U.K. trade deficit increased to £9.41 billion in June, while the economists projected the deficit to narrow down to £8.80 billion.
US Treasuries gained and sent yields to a one-year low due to approved US airstrikes in Iraq. As a result investors are looking for safe haven assets and debt is being bought all across the world. The US 10-yield fell 0.03 percentage points to 2.38 percent in London as the current conflicts could increase the risk to growth prospects.