The US Dollar depreciated against 15 out of 16 major peers as the increase in industrial activity boosted demand for riskier assets. US currency fell for the fourth straight day against its New Zealand counterpart as investors expect surge in American production activity. The Greenback declined 0.3% against the Euro reaching $1.2978 on Asian morning session. Currently EUR/USD is trading at $1.2979.
Singapore's economy declined in the 4th quarter, stressing Asian exposure to the debt turmoil in Europe despite manufacturing strengthening in India and China. Country's GDP fell 4.9% on a yearly basis in the 4th quarter of 2011, compared to previous quarter when it added 1.5%, reported nation's trade ministry. Overall economy expanded 4.8% in 2011 and according to forecasts may grow between 1% and 3%
Asian shares rallied on Tuesday fuelled by investor sentiment on improved China's manufacturing activity. Official China PMI data issued on Sunday indicated economy switched from contraction to expansion. Hong Kong's Hang Seng Index added 2.1%, Australia's S&P/ASX 200 index gained 1.1% and South Korea's Kospi rose 2.4%. Chinese and Japanese markets stayed closed for holidays.
European leaders warned that 2012 may be a challenging year as many experts predict the recession to persist. Angela Merkel said the next year would be the 'most severe check in decades' while France's President Sarkozy claimed the recession is not finished and the President of Italy called for sacrifices needed to combat the crisis.
Iranian president announced the bank of Iran is strong enough to overcome the difficulties created by 'enemies' after US President signed a defense bill stipulating that US financial institutions are not permitted to serve the companies that deal with the Iranian central bank.
Copper prices finished 2011 with the annual loss for the first time in the last three years. LME copper price lost more than 20% over the year. Experts blame Euro Zone's economic turmoil and slowdown in China. Copper price forecasts stay mixed with some experts predicting $10,000/tonne while some expecting $8000/tonne.
Precious metals as gold and silver will move higher on the increased money printing as more paper money diminish the currency purchasing power against gold and silver, said Alasdair Macleod, Senior Fellow at the GoldMoney Foundation. He predicts the gold to hit $3800 and the silver to move three times higher by the end of 2012.
Greece's pharmacists and doctors went on first strike this year. Doctors announced they would treat only the most emergency cases till Tuesday, expressing protest to changes in the healthcare provision. Pharmaceuticals protest to the government's plan to reduce the cost of the medicines to decrease the state spending. Lower price for medicines would save more than 90m euros in 2012 while health spending in Athens
Hiring in US probably advanced in December extending increase for a second straight month, said economists questioned by Bloomberg. According to median forecast, payrolls soared to 150 000 in December compared to 120 000 in November. Labor Department will issue data on January 6. However, report may also depict a slight increase in jobless rate, predict analysts.
On Tuesday German stocks led the gains in European markets fuelled by modestly better than expected manufacturing data as German PMI rose from 47.9 in November to 48.4 in December. German DAX opened 1.45% higher at 5,983.74 and extended its gains during day climbing 2.11% to 6,023.58. Among winning stocks was Siemens AG adding 2.09%, drug producer Bayer AG advancing 2% and chemicals manufacturer BASF SE surging
German sovereign bonds declined on the first trading day in 2012 as India and China reported an increase in Purchasing Manager's Index boosting optimism world economy may stabilize. The borrowing costs on German 10-year notes added 3 basis points or 0.03% reaching 1.86% on Tuesday morning. Yields for 2-year bonds gained three basis points attaining 0.18%.
Turkey's Lira recovered and advanced for a third straight day after it experienced a record low depreciation of 1.9224 per US Dollar last week. Lira ascended 0.4% to 1.8833 per US Dollar. Turkey's currency weakened by 17.7% last year and faced the largest depreciation among emerging economies, trailed by Bloomberg. Country's central bank intervened and sold dollars extensively on December 30.
Euro depreciated against Japanese Yen hitting 11-year record low before recovering on investor fear European debt turmoil will decelerate economic growth and undermine financial markets in 2012. 17-nation currency fell against its Japanese counterpart after data showed European industrial production deteriorated for a fifth consecutive month in December. Euro plunged ВҐ98.66 in morning session and lost 0.1% against greenback reaching $1.2947. Currently EUR/JPY is trading at
Dutch industrial production fell in December extending contraction for a fourth month in a row, said NEVI, Dutch research institute. The manufacturing gauge increased to 46.2 in December, compared to 46.0 in November. However the reading still is below 50.0, signalling contraction. Dutch PMI fell below 50 in September as budget cuts and slowing world trade began to harm demand.
Crude oil prices eased down during the last trade of 2011 on the negative headlines from the Euro Zone but the price was supported by fears over the disruption to oil supplies from Iran. Light, sweet crude oil futures for February delivery traded at USD98.89 a barrel, on the New York Mercantile Exchange, tumbling 0.95% during the week. On a yearly basis crude oil
China saw an improvement in core gauge of manufacturing that increased optimism over the stable economic expansion in 2012. The PMI increased to 50.3 in December as compared to 49 in November on the improved demand during the holidays. The December figure indicates that significant slowdown is not expected to occur this year, reported CFLP.
France's new car registrations tumbled 18% last month on a yearly basis. The decline was expected by analysts. French car manufacturers saw a 29% drop in registrations, while foreign producers faced only a 4.3% fall last month. During the 2011, new car registrations dropped 2.1% with Peugeot Citroen seeing a fall by 4.9% and Renault experiencing a decline of 9.6%.
Exxon won the case with Venezuela's government on the compensation for nationalization of the company's crude oil project. The amount of compensation totaled $908m that is $1bn less than the Venezuelan government offered three months ago. Exxon hopes for better court decision on the case regarding nationalization of Cerro Negro oil project.
The era of the common currency union is likely to end in the next decade with Italy and Greece leaving the Euro Zone in 2012, said leading expert. There is 99% probability that the single currency will not exist over the next 10 years, reported the CEBR. According to the CEBR forecast, the Britain economic growth will contract in the Q1 of 2012.
Grain futures jumped to several-week high on the adverse weather forecasts in Brazil and Argentina that may hurt the crops. US corn, soybean and wheat futures all posted gains in the last nine trading sessions. On the Chicago Mercantile Exchange, soybeans, wheat and corn futures for delivery in March increased over the last week by 3.25%, 4.8% and 2.8% respectively.
Oil prices almost doubled in many regions of Nigeria after the government withdrew oil price subsidy that cost $8bn a year. Residents are disappointed as higher oil price will also increase the price for other goods. Trade unions call people to go on strike. Nigeria being the African largest oil producer still imports the refined oil as corruption and malpractice made it impossible to refine
CME gold futures for delivery in February lost 5.1% or $82.10 during the last trade of 2011 on Friday. The gold shares also saw decline with NYSE Arca Gold Bugs Index decreasing by 6.6%. The move was unexpected by analysts as the gold futures traded higher before the holidays in the 8 years out of last 9, remarked Mitsui, Japanese gold dealer.
Spain public deficit in 2011 is expected to be much higher that targeted 6% of the GDP, said Luis de Guindos, Economy Minister on Friday. The announcement increased fears over the indebted Euro Zone and created downward pressure on the Euro which hit the record low against the Yen with the pair EUR/JPY currently trading at ВҐ99.54.
India may ease the monetary policy on the worries about the global economic downturn, announced the RBI. The bank plans to concentrate on the measures aimed at boosting growth rather than on controlling inflation. The bank increased its interest rate 13 times during the last 10 months to combat exorbitant inflation but growing worries over the slower growth forced officials to start reviewing monetary policy.