China Eases Lending Standards to Boost Housing – Will it Work?

Share This: – This daily digest focuses on market sentiment, new developments in China’s foreign exchange policy, changes in financial market regulations and Chinese-language economic coverage in order to keep DailyFX readers up-to-date on news typically covered only in Chinese-language sources. – China’s central bank cut the minimum down payment ratios for mortgages to stimulate the housing sector. – The iron and steel industry in China reported negative

US Dollar to Tap Fed Speakers, NFPs For Another Run at 12 Year High

Share This: …highs and move on to levels not seen since 2003. And once more it would fall short of the task. Thefundamental winds to the currency’s back are strong, but they are also well-encorporated. The relative fundamental appeal of the Greenback has carried EURUSD to 1.05, USDJPY to 126 and USDCNH to 6.60. An extension of this already-impressive run would require a serious escalation in conviction. But, what short of a realized Fed hike or financial plunge forcing investors to scramble for safety

Fonterra Milk Auction To Put Spotlight on RBNZ’s Next Move

Share This: …investment bank research notes favor the later as a likely December Federal Reserve liftoff looms. The main domestic data this week came in the form of the financial Stability Report, which was followed by a Wheeler conference that reinforced the view that RBNZ is on hold for the time being. A holding RBNZ and consistently weak milk auctions continue to put downward pressure on the NZD. Another milk auction next week will be looked to either reverse the trend or confirm the dropping demand

British Pound Shows Signs of Life – Next Week Could be Big

Share This: …release of minutes from the BoE financial Policy Committee’s November meeting as well as planned public speeches from Governor Mark Carney on December 7th and 11th for clues on the future of UK monetary policy. The key question is simple: will the Bank next move to raise interest rates and, if so, when? A surprising result from the past week’s European Central Bank interest rate decision had a similarly surprising effect on Bank of England rate expectations; the ECB failed to cut

US Rate Speculation Versus a Tumultuous World of Fundamentals

Share This: …them eager to get it out of the way). Yet, after ‘liftoff’, projecting the second, third, fourth and so on increases will be more important for developing extended values. A number of Fed member discussions scheduled this week will likely help shape that forecast. Chairwoman Janet Yellen is set to testify between the Joint Economic Committee in Congress; but I’m more interested in Fed Brainard’s speech on neutral rates, Mester and Fischer’s talks on financial

US Dollar Wobbles But Fed Speculation and Liquidity Keep a Bid

Share This: …Drained of liquidity by various holidays, the normal expectation is for quiet and steady gains (often called the ‘Santa Claus’ rally). However, this time around, the thin market conditions can lead to serious trouble as the threat of volatility remains dangerously high. A number of big-picture financial risks hang over the markets including China’s economic cooling and financial stability; emerging market capital flows; and global growth trends among others. These threats

British Pound Looks like a Buy, but Watch Huge Risk on Fed Decision

Share This: …England will only move by 24 basis points. This gulf helps explain why the British Pound has fallen versus the US Dollar, but a material change in Fed expectations could quite easily encourage traders to close GBP/USD-short positions and send the GBP higher. All eyes will be on the Fed and especially Janet Yellen in what promises to be a huge week across financial markets. original – Fundamental Forecast for British Pound: Bullish The British Pound declines as

Will the Chinese Yuan Stop Falling in the Week Ahead?

Share This: …Chinese commercial banks in October. This lending figure fell for the first time in six years, since the 2008/2009 global financial crisis. As a result, we believe that the new yuan loan figure will be a good indicator for traders to get a better sense of financial market sentiment in China. According to the most recent Bloomberg News survey, the November new yuan loans figure is expected to improve slightly to ¥750.0 billion. The China November Consumer Price Index is another main

ECB Post-Mortem: Higher in ST before Lower in MT for EUR/USD

Share This: …has been the only thing working against the ECB: the exchange rate and other financial market conditions have been very accommodative and supportive of the recovery in recent weeks. Unlike in July 2012, when President Draghi promised to do “whatever it takes” to keep the Euro-Zone together – a time when 10-year yields in several of the PIIGS were hovering around 7% – the current economic backdrop isn’t one that warranted a ‘bazooka’-like response by the

US Dollar Fundamentally Moored Until Fed or Fear Decides Its Fate

Share This: …broader financial markets. Anxiety will support volatility, but fostering trends will be far more difficult. Active traders should adapt to the environment while investors (longer term) should mark the change in tempo for the currency’s monetary policy advantage post-ECB and pre-FOMC. Market conditions represent a separate analysis type in my book, but it has ties to traditional fundamentals and technicals. For the Dollar, the speculative focus on particular underlying themes and the