Daily Forex Market overview by IFC Markets

Sara

Trader
Jul 9, 2013
6
0
12
London, United Kingdom
Chinese economy is slowing down.

The main focus today morning is on China's GDP data, confirming the decline of economic activity in the second-largest economy in the world. The annual figure rose by 7.5% in the second quarter, compared with growth by 7.7% in the first quarter. Since the figure was in accordance with the projects we have not seen any strong movement in the markets. The subtle support was gotten by the Australian dollar traded against the US dollar at 0.91, a little bit higher than the newly refreshed 3-year low.

As for other currency pairs, they are also relatively quiet so far. Anyway, we note that the US dollar started the week with recovery vs. major currencies after the price collapse last week, when the Fed Chairman, Ben Bernanke expressed concerns about the vulnerability in the labor market and put early QE reduction in doubt. The market reaction was excessive, as it seems to us and now the EURUSD and the GBPUSD return to the psychologically important levels at 1.30 and 1.50, respectively, and the USDJPY may retest the level 100.

We expect quiet trading dominated by the movement in favor of the US currency during the European trading session on the weak news flow, and later in the evening, we will wait for the US Retail Sales statistics for June. Market participants expect it to be improved, as it could support the dollar.