Forex Blog

The dollar fell at a fastest pace in 3 weeks against the euro today as the Q1 GDP decline was reported to be not so bad as expected. EUR/USD is now trading near 1.4114 and technical analysis shows that it will probably continue to grow at least until 1.4350 in the next few weeks.

Preliminary GDP report for the first quarter of 2009 showed a decline by 5.7% — better than the 6.3% drop that was reported in the advance report a month ago. Market analysts expected a revision to -5.5%.

Chicago PMI index unexpectedly decreased from 40.1 to 34.9 in May. The traders expected a growth to 42.

Michigan Sentiment index rose to 68.7 in May from 65.1 in April. It was expected to be reported at 68.0.

Despite the huge and quite unexpected drop of the U.S. gross domestic product in the first quarter of 2009 reported today, the stock markets rose globally, spurring euro and other high-yielding pairs in their gain against the greenback. The interest rates left unchanged weren’t a big news for the Forex traders. EUR/USD is now trading near 1.3264.

According to the advance report GDP decreased by 6.1% in the first quarter of 2009. It was down by 6.3% in the fourth quarter of 2008. Forecasts showed -4.9% for Q1 2009.

U.S. commercial crude oil inventories rose one more time last week — by 4.1 million barrels. They are still above the upper boundary of the average range for this time of year.

The Federal Reserve’s FOMC left interest rates unchanged at the range between 0% and 0.25%. They also left the amount of the U. S. Treasury securities that they will buy by autumn unchanged at $300 billion.

Euro traded slightly stronger against the dollar today before and after the reports that only confirmed that the U.S. is still in recession. EUR/USD is currently trading near 1.3591.

Initial jobless claims rose from 644k to 652k last week, while they were expected to go up only to 650k.

Final Q4 GDP report showed a revised decline of 6.3% (compared to 6.2% preliminary report). The economic analysts expected a decline by 6.6% to be reported today.

EUR/USD continued to fall today for the fourth straight day as the advance GDP report for the fourth quarter showed a considerable decline of the economic output in U.S. The currency pair is currently trading near 1.2795.

GDP (advance) in the Q4 of 2008 decreased at an annual rate of 3.8%. The decline followed 0.5% contraction in the third quarter, but was significantly below the estimated 5.4% drop.

Chicago PMI declined from 35.1 to 33.3 in January, while a drop only to 34.9 was expected by the market participants.

Michigan Sentiment Index rose above the previous month’s value of 60.1 (which was revised down from 61.9) in January and was reported at 61.2. The average forecast for this index was at 61.9 for January.

It looks like EUR/USD can’t really decide where to go next — the second consecutive day is marked with almost zero change with a slight advantage for the European currency. The final data on Q3 GDP along with some other macroeconomic reports didn’t surprise the traders enough to affect the Forex market today. EUR/USD is currently trading near 1.3971.

The Gross Domestic Product decline of 0.5% in the third quarter of 2008 remained unchanged in the final report by the Bureau of Economic Analysis. That was an expected result.

Existing home sales declined by 8.6% in November to the seasonally adjusted annual rate of 4.49 million — that’s significantly below the expected rate of 4.93 million.

Michigan Sentiment index rose from 55.3 in November to 60.1 in December — faster than the analysts forecast (58.6).

New home sales decreased in November — to the seasonally adjusted annual rate of 407k — down from 419k in October (revised from 433k). The median forecast value was at 420k.

EUR/USD continue to rise today for the third straight day on the stock market optimism that was earlier based on the Citigroup bail-out and now on a new plan worth $800 billion to unfreeze the lending in the U.S. financial system. Fundamental reports from the United States that were released today didn’t impact Forex rates much. EUR/USD is currently trading near 1.3029.

Preliminary value for the Q3 U.S. GDP decline was revised downwardly to 0.5% from 0.3% drop released almost a month ago. It was expected by the market participants and didn’t affect the EUR/USD rate.

Consumer confidence unexpectedly rose in November – from 38.8 to 44.9. That’s a clear positive news for the global financial markets, but probably not for the U.S. dollar. The consensus forecast for the current month’s value was at 39.5.

EUR/USD continued to rise today and showed a third day of gain on the Forex market, as the dollar fell after the yesterday’s rate cut decision. Federal Reserve reduced the funds rate from 1.5% to 1%. Another reason for the dollar’s decline were the macroeconomic indicators released in U.S. EUR/USD is currently trading near 1.3035 after reaching 1.3288 today.

The advance report for the third quarter 2008 GDP change showed a contraction by 0.3% — better than 0.5% drop expected by the analytics, but significantly worse than 2.8% growth a quarter before.

Initial jobless claims remained unchanged during the last week — at 479,000 (although the previous week’s value was upwardly revised from 478,000).

EUR/USD rose today after the U. S. GDP Q2 results release disappointed many traders. The global stock markets also fell and not the last reason for that was the complete uncertainty about the $700 billion rescue plan. EUR/USD is currently trading near 1.4638 level.

GDP in the second quarter of 2008, according to the final revision report, rose at an annual rate of 2.8% — that’s 0.5% below the previous revision’s 3.3% growth. The forecast by the economic analysts showed 3.4% expectation for the final revision.

Michigan Sentiment index dropped from 73.1 to 70.3 in September. This fall exceeded the traders’ expectations — the average forecast for September’s value of this index was 71.0.

EUR/USD soared up today immediately after the report on advance GDP figures for the second quarter of 2008 came out in U.S. It disappointed the investors and is currently pressing on the greenback. Employment data also came out much worse than the majority of the traders expected today. EUR/USD is currently trading near 1.5633 level after reaching as high as 1.5700 in early trading after GDP report.

Advance GDP growth in the second quarter of 2008 was reported to be 1.9%. Although it’s better than 1% growth in Q1, it’s much worse than the expected 2.3% growth for the second quarter.

Initial jobless claims were at 448,000 last week — the growth from 404,000 claims a week before. Average forecast for the last week was 395,000.

Chicago PMI rose from 49.6 to 50.8 in July. It was forecast3ed to decline to 49.0 this month. It was the first growth posted by this indicator in last five months.

EUR/USD didn’t change from its upward trend today after the final Q1 GDP data was released. The currency pair continued to grow for a third day in a row and advanced today from 1.5664 to 1.5737 after the most important fundamental reports for today were released in U.S.

GDP in the first quarter of 2008 advanced at an annual rate of 1.0 percent — higher than 0.9 percent growth reported in the preliminary report and it has met the analysts’ expectations.

Initial jobless claims didn’t change last week — they remained at the revised value of 384k (revised up from 381k). They were expected to fall to 375k last week.

Existing home sales rose unexpectedly in May — to 4.99 million (annual rate) from April’s 4.89 million. They were expected to rise to 4.95 million.