Please select your home edition
Edition
Collinson and Co

Collinson FX Market Commentary- November 29, 2012 - Market windshifts

by Collinson FX on 29 Nov 2012
Image of the Day Vendee Globe - Macif skipper Francois Gabart (FRA) Vincent Curutchet / DPPI / Vendée Globe ©

Collinson FX market Commentary: November 29, 2012

http://itunes.apple.com/app/collinsonfx/id533360650?mt=8!Click_here to find out how to get CollinsonFX's free iPhone app

Markets now move depending on the way the wind is blowing in relation to the EU crises and Fiscal Cliff negotiations.
Equities were lower earlier after doubts regarding the Greek solution started to emerge in the media. Reports that Greek debt holders would again be required to take debt write-offs undermining the new deal and future solutions.

The EC look set to provide EUR$40 Billion to bail-out the nationalised Spanish Banks relieving some pressures. Markets turned positive after Obama indicated a deal would be done prior to Christmas to avert the Fiscal Cliff. House Leader Boehner was also in a positive frame of mind with revenue on the table under the proviso of no rate rises. This will probably remain the determinant of market direction until a deal is struck.

New Home Sales in the US fell 0.3% and Weekly Mortgage Applications dropped 0.9% contradicted the Home Price Index numbers yesterday. The Biege Book will be released today and will probably show what it always does. Weak growth and a slow recovery!

The EUR traded 1.2930 and the GBP 1.6000 unchanged as economic news was countered by sentiment.

Commodities remain steady with the AUD 1.0475 and the KIWI 0.8233 as confidence returns and demand rises. Political developments will continue to dominate market direction.


Collinson FX market Commentary: November 28, 2012
Good news from Europe where a deal was reached over the Greek debt crises. No solution but a postponement of the problem allowing the EU time for an economic recovery. The agreement cuts interest rates on outstanding debt, defers payment of said interest payments and extends the maturities of the debt.

To put this in to perspective the EU and IMF have basically waved the cost of the debt for the forseeable future thereby alleviating the pressure on Greece all the while adding to that debt by extending further loans to enable the state to run.

The next step will be to write-off that debt which would be the last measure and detroy what little credibility the EU/IMF have. Now they will look to addressing the crises in Spain and Italy who will demand similar terms under precedence.

Unlimited cost free funding which can only be funded by monetary expansion triggering inflationary pressures which will destroy the single currency and mortally wound the EC.

Political ill-will and procrastination drives Europe to a far bigger cliff than the US face. The EUR traded 1.2935 with the GBP 1.6020 looking vulnerable. In the US, talks around Fiscal Cliff negotiations appear to be heading in the wrong direction with growing pressure from Democrats to ignore fiscal cuts and extend taxes.

The left seems committed to driving America into Socialism and dependency which will lead to destruction as it had in Europe.

The Case Shiller Home Price Index rose again offering some good news with a rise in Consumer Confidence boosting hopes, although durable good orders were flat.

The AUD held 1.0450 and the KIWI 0.8200 but the looming crises in the US adds to downward pressures.


Collinson FX market Commentary: November 27, 2012

Stocks opened the new week in the US lower with growing doubts about evasion of the fiscal cliff. Politicians are toying with the fiscal cliff with many seeing tax rises and cuts to defense as more than just palatable, attractive even.

Democrats are expected to be divided over this and a grand coalition of post-election euphoria is disappointing quickly. Obama may hobble an agreement but taxes will rise and entitlement spending will continue to spiral out of control. In Europe, EU members failed to agree on the new seven year budget but all managed some successful photo opportunities. EU Finance Ministers gathered to approve the release of the next tranche of the Greek Bailout.

Debt has overwhelmed the country with GDP contracting thus preventing the servicing of existing debt at discount interest rates. The next step will be an interest rate moratorium followed by debt write downs. This is a broken state and the continued support is untenable but preferable to the collapse of the single currency. The EUR trades below 1.3000 while the GBP holds 1.6000. In the US the Dallas Fed's Manufacturing Activity Index contracted 2.8 and the Chicago Feds Activity Index also fell 0.56.

Economic data will not be great short term and Political procrastination should ensure a return to global recession by the new year. Doha Global Climate Change should sort out the Earths warming by taxing the richer nations providing some relief. It is working well in Australia with the largest global Carbon Tax reducing temperatures to sooth the populace!

Commodities remain steady with the AUD holding above 1.0400 and the KIWI just under 0.8200.

For more on Collinson FX and market information see:
www.collinsonfx.com and www.collinsonwealthmanagement.com

Countries: | NZ: 0800 338 838 | AU: 1800 143 415 | NY: 1888 6257 833 | UK: 0800 0285 834 |


Disclaimer: The details expressed in this website and accompanying documents or transmissions are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Collinson Forex Ltd accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the information contained or related to this site.

Collinson and Co

Related Articles

Collinson FX Market Commentary - Apr 25 - Two week cruise to victory?
The AUD slipped back to 0.7550, while the KIWI looks to test 0.7000, on the downside Markets exploded in reaction to the first round of the French Presidential elections. The French CAC rallied over 4%, with Centrist candidate Macron, leading through to a run-off with LePen. Polls predict an easy win for Macron, who has been endorsed by the traditional left and right wing parties, but it is a two horse race?!
Posted on 25 Apr
Collinson FX Market Commentary - Apr 22 - Trump's action sparks rally
Markets rallied to close the week with Trump signing executive orders for tax reform and financial deregulation. Markets rallied to close the week with Trump signing executive orders for tax reform and financial deregulation. Tax reform is likely to come next week and financial deregulation is likely to come in the form of repeal of the Dodd/Frank legislation. This will release markets and fuel the rally. France hold the first round of the Presidential elections this weekend with the possibilities ensuri
Posted on 24 Apr
Collinson FX Market Commentary - Apr 21 - NZD struggles
AUD moving above 0.7500, while the NZD is battling to hold 0.7000. The EUR held 1.0700, while the GBP is consolidating the lofty gains posted by the snap-election, as elections dominate markets. Commodities currencies were steady, with the AUD moving above 0.7500, while the NZD is battling to hold 0.7000.
Posted on 20 Apr
Collinson FX Market Commentary - Apr 20 - AUD drops on confidence loss
The rising reserve is testing the 0.7000 number on the NZD, while the AUD fell below 0.7500 European markets are under pressure with the arrival of the French elections. It look like a right-left run-off is the likely result but on the extremes. LePen and a candidate from the left will go through to a final run-off. This will drive markets into a nervous period
Posted on 20 Apr
Collinson FX Market Commentary - Apr 19 - Early election jumps UKP
The reserve softened allowing, the NZD to consolidate above 0.7000, supported by dairy prices. European markets were thrown a curve ball, when UK PM May called for an early election, while the pending French election has the prospect of upending the EU. The snap election in the UK is seen as an opportunity to consolidate and validate the Tory Govenrment leading in to Brexit.
Posted on 19 Apr
Collinson FX Market Commentary - Apr 16 - Trump jawbones USD down
The commodity currencies surged, with the AUD jumping almost a big figure, to 0.7570. The commodity currencies surged, with the AUD jumping almost a big figure, to 0.7570. The KIWI was testing 0.6900, on the downside, but spiked towards 0.7000 with the Trump jawboning. The coming week is full of significant global economic data releases which will impact currencies while Geo-Political developments remain the major driver of any substantial moves.
Posted on 16 Apr
Collinson FX Market Commentary - Apr 13 - KIWI set to take a dive
The AUD fell back to 0.7475, while the NZD looks to test dangerous levels below 0.6900 The AUD fell back to 0.7475, while the NZD looks to test dangerous levels below 0.6900, despite steady commodity prices. Local House prices in NZ may have a marginal impact, along with Australian confidence data, but major directional drivers are coming from the USA. The AUD attempts to regain 0.7500, with local Consumer Confidence confirming rising sentiment, despite the reserve.
Posted on 13 Apr
Collinson FX Market Commentary - Apr 12 - US on financial reform path
Commodities remained firm, supporting the associated currencies, with the NZD holding 0.6950. The Dollar was steady, with the EUR trading 1.0600, although the Yen moved up to 109.70. Commodities remained firm, supporting the associated currencies, with the NZD holding 0.6950. The AUD attempts to regain 0.7500, with local Consumer Confidence confirming rising sentiment, despite the reserve.
Posted on 11 Apr
Collinson FX Market Commentary - Apr 11 - Cordiality or fireworks?
Commodities were steady, with the NZD trading around 0.6950, while the AUD attempts to regain 0.7500 The looming French elections have the potential to disrupt European markets and will have flow on effect on global markets. The EUR traded below 1.0600 while the Yen pushed 111.00. Commodities were steady, with the NZD trading around 0.6950, while the AUD attempts to regain 0.7500.
Posted on 10 Apr
Collinson FX Market Commentary - Apr 7-8 - Syrian attack spooks US
The NZD will open the week above 0.6900, while the AUD struggles to hold 0.7500. US airstrikes on the Syrian airbase, that delivered the Chemical weapons attack on their own people, was an important signal to players in the region. Trump is not willing to allow these red lines to be crossed. This hit equity markets early but US markets recovered to post gains by the close.
Posted on 10 Apr