Greenback Testing Lows

* The dollar traded modestly lower near key support on Monday. US new-home sales surged a stronger-thanexpected 11.0% m/m, a third straight gain and the biggest in eight years. The S&P 500 was up 2.92 points to 982.18. The euro gained in early trade on better-than-expected German consumer confidence and the EUR/USD rose to a 7-week high. The commodity currencies advanced on the improving global growth outlook. The USD/CAD was down, testing the 1.08 support, while the AUD/USD was up, testing resistance at 0.83 on the better commodity price outlook.

* The USD/JPY was supported by Japanese demand for foreign higher yielding assets and carry trades. The pair broke its short term-downtrend and will likely test resistance in the 97 area. There is support in the 92 area.



www.cmsfx.com

Financial and Economic News and Comments

US & Canada

* US new-home sales rose for a third consecutive month in June, jumping a more-than-expected 11.0% m/m, the largest gain in eight years, to a 384,000 annual rate, after an upwardly revised 2.4% m/m gain to a 346,000 annual rate in May, figures from the Commerce Department showed. June new-home sales dropped 21.3% y/y. Sales increased in the Northeast, Midwest, and West, but declined in the South. The median price for a new home was $206,200 in June, down 12.0% y/y. The average price of a new home was $276,900, down 7.5% y/y. At the current sales rate, the supply of unsold new homes declined to 8.8 months in June from 10.2 in May. The decline in the months’ supply was due to both the faster pace of sales and a continued decrease in the inventory of unsold new homes. Inventories fell 4.1% m/m to 281,000 in June, the fewest since February 1998. Overall, the June figures indicate the US housing market is starting to recover from its slump.

www.cmsfx.com

* Midwest manufacturing output continued its decline in June. The Chicago Fed Midwest manufacturing index was down 0.3% m/m to 78.1 after May’s revised 3.0% m/m decrease to 78.3, the Federal Reserve Bank of Chicago reported.

* The Dallas Fed general business activity index declined to -25.5 in July from -20.4 in June, indicating Texas manufacturing activity remains weak, the Federal Reserve Bank of Dallas reported.

Europe

* Germany’s consumer confidence improved for a third month in August on economic recovery signs. The GfK German sentiment index increased to 3.5, a 14-month-high, from July’s upwardly revised 3.0, according to a report by GfK Group. The economic expectations index increased to -14.0 from -22.6. The income expectations index advanced to 1.8 from -3.3. The gauge of consumer propensity to buy jumped to 25.1 from 14.5.

www.cmsfx.com

* Germany’s import prices fell 11.3% y/y in June, the largest year-on-year drop since February 1987, after a 10.4% y/y decrease in May, the Federal Statistical Office reported. June import prices increased 0.4% m/m, driven by an increase in crude oil prices. Excluding crude oil and mineral oil products, June import prices were down 0.6% m/m and 5.7% y/y.

* UK house prices declined 7.7% y/y to £155,600 ($256,351) in July, Hometrack Ltd. reported.

Asia-Pacific

* Japan’s corporate service prices declined 3.2% y/y in June, a ninth consecutive year-on-year drop and the biggest since records began in January 1985, following a 3.0% y/y slide in May, the Bank of Japan said.

FX Strategy Update



©2004-2008 Globicus International, Inc. and Capital Market Services, L.L.C.

Источник: Hans Nilsson

27.07.2009