Treasury Secretary Disappoints Markets

Daily Forex Fundamentals | Written by Easy Forex | Feb 11 09 01:15 GMT |

U.S. Dollar Trading (USD) the mood darkened considerably yesterday as the much anticipated speech from Geithner failed to deliver and what started as profit taking turned into a rout. Banking stocks were under pressure as Geithner lacked clarity in the direction the new administration will take. Crude Oil closed down -$2.01 ending the New York session at $37.55 per barrel. In US share markets, the Dow Jones fell 381 points or -4.62% and the NASDAQ dropped -66 or -4.2%. Looking ahead, December Trade Balance forecast to improve to -36Bn vs. -40.44Bn previously. The Euro (EUR) came under selling pressure as EUR/JPY sales and a report out of Japan concerning $400bn Russian Bank Debt took hold. The reports were discounted and the pair rallied back above 1.3000 before risk aversion became the dominate force sending the pair crashing lower. Overall the EUR/USD traded with a low of 1.2812 and a high of 1.3074 before closing the day at 1.2875. Looking ahead, January CPI is forecast to -0.5% vs. 0.3% previously. The Japanese Yen (JPY) tracked equities with crosses steadily falling in Asia before dropping sharply in the US session with those stocks falling over 4%. Household Confidence gained slightly to 26.4 vs. 26.2 previously. Overall the USDJPY traded with a low of 90.14 and a high of 91.66 before closing the day around 90.40 in the New York session. The Sterling (GBP) fell back sharply as the GBP/JPY shunted lower. UK December Trade Balance improved to -7.4Bn vs. -8.1Bn previously. GBP has been very volatile in recent months so the 400 pip drop does not necessarily indicate a resumption of Pound weakness. Overall the GDP/USD traded with a low of 1.4458 and a high of 1.4892 before closing the day at 1.4550 in the New York session. Looking ahead, December ILO Unemployment Rate is forecast to rise to 6.3 vs. 6.1. The Unemployment Change in January is forecast to rise to 90k vs. 77.9K previously. The Australian Dollar (AUD) suffered severely as the sentiment changed and US stocks tanked. The recovery in recent weeks has been impressive but the pair gave up over 4% overnight. NAB Business Confidence fell to a record low of -32 in January. Also lower February Consumer Confidence down -4.6%. Overall the AUD/USD traded with a low of 0.6486 and a high of 0.6754 before closing the US session at 0.6540. Gold (XAU) rallied as Financial Risk flared again on banking concerns. Overall trading with a low of USD$891 and high of USD$918 before ending the New York session at USD$915 an ounce. Easy Forex http://www.easy-forex.com Easy-Forex makes no recommendations as to the merits of any financial product referred to in this website, emails or its related websites and the information contained does not take into account your personal objectives, financial situation and needs. Therefore you should consider whether these products are appropriate in view of your objectives, financial situation and needs as well as considering the risks associated in dealing with those products