Reuters: US Dollar Report: FOREX-Dollar near 6-week low after no tapering hint from Fed

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FOREX-Dollar near 6-week low after no tapering hint from Fed Aug 1st 2013, 06:10 Thu Aug 1, 2013 2:10am EDT * Dollar/yen manages to stay above important Ichimoku support * ECB, BoE meetings expected to keep forward guidance on rates * Aussie plumbs 3-year lows By Ian Chua and Hideyuki Sano SYDNEY/TOKYO, Aug 1 (Reuters) - The U.S. dollar wallowed near six-week lows against a basket of major currencies on Thursday after the Federal Reserve gave no fresh hints that it was preparing to scale back stimulus at its next meeting in September. The Fed said it would keep buying $85 billion in mortgage and Treasury securities per month and noted the potential dangers of inflation running too low, while calling the pace of economic growth "modest" rather than "moderate", as it had consistently for most of the past year. "The Fed seems to have downgraded their overall economic assessment, thus capping the dollar," said Minori Uchida, chief currency analyst at the Bank of Tokyo-Mitsubishi UFJ. The dollar index, which tracks the greenback's performance against a basket of major currencies, last stood at 81.884 , about 0.2 percent above late U.S. levels but still not far from a low of 81.407 touched on Wednesday. But many economists still expect the Fed to begin slowing its asset-buying programme as early as next month, especially in light of data showing U.S. economic growth was not quite as weak as expected in the second quarter. "The Fed sounded a bit more dovish on the economy ... just enough to keep the dollar from going too far on the back of stronger data. In fact, you saw yields in the U.S. go lower overnight. That leaves us still waiting for other major central banks," said Greg Gibbs, senior strategist at RBS in Singapore. Traders also say a strong reading in Friday's U.S. employment data could cement expectations of a reduction in the Fed's stimulus in September and thus boost the dollar. Against the yen, the dollar managed to hold above important support from the Ichimoku cloud bottom near 97.50. It got a further boost after China's official manufacturing data showed a small improvement, lifting Asian shares. The dollar last traded at 98.35 yen, up 0.5 percent from late U.S. levels, off Wednesday's five-week low of 97.585. TALKING DOWN THE EURO? As the dollar sagged, the euro reached a six-week high around $1.3345, but the common currency later eased back to $1.3270 with investors wary of getting too carried away ahead of policy meetings at the European Central Bank and Bank of England later on Thursday. The ECB is expected to hold off on further stimulus but is seen standing by last month's forward guidance, expecting rates to stay at 0.5 percent or lower for an "extended period". "When the euro has risen, ECB Governor (Mario) Draghi often tries to rein it in. I suspect a euro around $1.33 would be a burden for euro zone countries other than Germany. So he may try to talk down the euro a bit," said Mitsubishi Bank's Uchida. The big mover was the Australian dollar, which skidded towards 89 U.S. cents in thin trade, reaching its lowest in three years. The Aussie fell as far as $0.8910 on Wednesday and was on track to end the week down more than 3 percent. Although the currency drew some comfort from the Chinese manufacturing data, it remained vulnerable at $0.8949, flat on the day, with the next major level seen at the August 2010 trough of $0.8770. Traders said stops were triggered below 88.00 yen , which took the Aussie to 87.42 yen, it lowest level this year. That sell-off weighed heavily on the commodity currency broadly. The Aussie was already having a bad week following dovish comments from Reserve Bank of Australia (RBA) Governor Glenn Stevens on Tuesday, which led the market to not only price in a cut in rates next week, but a second easing before year-end. "The Aussie is clearly on its knees, in particular we think Stevens gave the green light for the currency to go lower," said Su-Lin Ong, senior economist at RBC in Sydney. "When you get that and generally disappointing Chinese data, the U.S. continuing to point towards a pick-up in the economy, it's a whole confluence of factors that keeps downward pressure on the currency." Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: GLOBAL MARKETS-Asian shares, commodities up on China PMI; dlr off 6-wk low

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GLOBAL MARKETS-Asian shares, commodities up on China PMI; dlr off 6-wk low Aug 1st 2013, 02:43 Wed Jul 31, 2013 10:43pm EDT * China official PMI comes in better than expected * Asian shares head for first gain in four days * Australian dollar off 3-yr lows, dollar up from 6-wk lows * Commodity prices extend gains By Wayne Cole and Dominic Lau TOKYO/SYDNEY, Aug 1 (Reuters) - Asian shares and commodity prices rose on Thursday after China's official manufacturing activity data came in better than expected, easing some concerns of a sharp slowdown in the world's second-largest economy. The Australian dollar, which is seen as a proxy of Chinese growth because of the countries' strong trade links, pulled away from a three-year trough of $0.8910 hit in early deals. The currency was last at $0.8974, up 0.3 percent on the day. Growth in China's manufacturing sector picked up slightly last month and was stronger than market expectations, an official survey showed. "People are pretty sceptical about the number itself. You will see short-term relief ... but not a massive relief," a hedge fund manager said. A separate HSBC PMI survey showed China's factory activity shrank for a third straight month in July, matching a preliminary reading published last week. Still, the official data was enough to spur Chinese and regional stocks higher. Asian shares measured by MSCI Asia-Pacific ex-Japan index advanced 0.4 percent to be on track to snap a three-day losing run. China's CSI300 index climbed 2.1 percent. In Tokyo, Nikkei share average rose 0.9 percent, and the Nikkei China index, comprised of 50 companies with large exposure to the Chinese economy, outperformed with a 1.2 percent gain. Beijing is trying to tackle overcapacity in industries such as steel, cement and shipbuilding, but wants to make sure the economy, which has slowed in nine out of the past 10 quarters, does not lose too much momentum. To that end, it has unveiled a series of targeted steps in recent weeks, including spending on social housing and railways and tax cuts for small businesses. Commodity prices were also buoyed by China's official PMI. Brent crude prices gained 0.3 percent to trade above $108 a barrel. They had climbed 0.7 percent after the U.S. Federal Reserve said at its policy review that it would continue to buy $85 billion in assets per month and made no mention of when it might start to taper its purchases. Gold added 0.3 percent to around $1,326 an ounce after a whippy session on Wednesday where it fell as low as $1,305.30, while copper prices rose 1 percent, extending a 2.2 percent bounce in the previous session. In the foreign exchange markets, the dollar was up 0.4 percent against a basket of major currencies, pulling away from a six-week trough hit on Wednesday. The greenback was up 0.3 percent at 98.180 yen, while the euro dipped 0.1 percent to $1.32860. ECB, BOE IN SPOTLIGHT Policy meetings at the European Central Bank and the Bank of England could see both reaffirm their guidance that rates will stay low for an extended period, perhaps to the benefit of the U.S. dollar. Overnight, Wall Street stocks had ended near flat. Stocks and commodities had been supported by data that showed the U.S. economy grew an annualised 1.7 percent in the second quarter, beating forecasts of a 1.0 percent rise. However, growth in the previous four quarters was revised down and the overall impression was of a sub-par performance. That point was acknowledged by the Fed in the handful of changes made to its policy statement. It characterised growth as "modest" rather than moderate and recognised the risk that inflation could go too low. "As a new addition to the statement, it does count as a very minor, marginally dovish change to the official line," said Martin McMahon, an economist at Commonwealth Bank of Australia. Yet while Treasury yields dipped slightly on the statement, the market still suspects the Fed to will start slowing the pace of stimulus sooner rather than later. "We continue to expect tapering of the open-ended asset purchases to commence in the autumn, probably already following the September 18th FOMC meeting. If not, then certainly before year-end," added McMahon. Much might depend on what the U.S. payrolls report shows on Friday. Forecasts favour a solid increase of 184,000 with perhaps a chance of an upside surprise after the ADP survey showed private jobs rose 200,000 in July. Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: Brazil to let import taxes fall to battle inflation -source

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Brazil to let import taxes fall to battle inflation -source Aug 1st 2013, 02:52 BRASILIA, July 31 | Wed Jul 31, 2013 10:52pm EDT BRASILIA, July 31 (Reuters) - Brazil will not renew higher duties due to expire later this year on 100 imported goods, a government official told Reuters on Wednesday, in a move that aims to lower inflationary pressures stemming from a weaker local currency. Last September, President Dilma Rousseff's government temporarily raised levies on imported products that include iron pipes, bus tires, steel bars, glass, and aluminum cables, in an effort to protect local producers. The increase in tariffs sparked complaints from trade partners, including the United States, about growing protectionism in the commodities powerhouse. The government plans to let the higher duties expire in two months to prevent more expensive imports from pushing up consumer prices. "We are adopting this measure to mitigate the effects of a stronger dollar on inflation," said the official, who asked not to be named in order to speak freely. The real has depreciated more than 11 percent versus the U.S. dollar this year, pushing up the value of imports. The real weakened to four-year lows earlier on Wednesday. A drop in transportation and food prices helped ease inflation in the 12 months to mid-July, but the consumer price index remains near the official target ceiling of 6.5 percent. Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: FOREX-Dollar near 6-week low after no tapering hint from Fed

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FOREX-Dollar near 6-week low after no tapering hint from Fed Aug 1st 2013, 03:05 Wed Jul 31, 2013 11:05pm EDT * Dollar softer after Fed gives no stimulus exit details * Dollar/yen manages to stay above important Ichimoku support * ECB, BoE meetings expected to keep forward guidance on rates * Aussie plumbs 3-year lows By Ian Chua and Hideyuki Sano SYDNEY/TOKYO, Aug 1 (Reuters) - The U.S. dollar wallowed near six-week lows against a basket of major currencies on Thursday after the Federal Reserve gave no fresh hints that it was preparing to scale back stimulus at its next meeting in September. The Fed said it would keep buying $85 billion in mortgage and Treasury securities per month and noted the potential dangers of inflation running too low, while calling the pace of economic growth "modest" rather than "moderate," as it had consistently for most of the past year. "The Fed seems to have downgraded their overall economic assessment, thus capping the dollar," said Minori Uchida, chief currency analyst at the Bank of Tokyo-Mitsubishi UFJ. The dollar index, which tracks the greenback's performance against a basket of major currencies, last stood at 81.777 , slightly above late U.S. levels but still not far from a low of 81.407 touched on Wednesday. But many economists still expect the Fed to begin slowing its asset-buying programme as early as next month, especially in light of data showing U.S. economic growth was not quite as weak as expected in the second quarter. "The Fed sounded a bit more dovish on the economy... just enough to keep the dollar from going too far on the back of stronger data. In fact, you saw yields in the U.S. go lower overnight. That leaves us still waiting for other major central banks," said Greg Gibbs, senior strategist at RBS in Singapore. Traders also say a strong reading in Friday's U.S. employment data could cement expectations of a reduction in the Fed's stimulus in September. Against the yen, the dollar managed to hold above important support from Ichimoku cloud bottom near 97.50. It got a further boost after China's official manufacturing data showed a small improvement, boosting Asian shares. The dollar last traded at 98.27 yen, up 0.4 percent from late U.S. levels, off Wednesday's five-week low of 97.585. TALKING DOWN THE EURO? As the dollar sagged, the euro reached a six-week high around $1.3345, but the common currency later eased back to $1.3276 with investors wary of getting too carried away ahead of policy meetings at the European Central Bank and Bank of England later on Thursday. The ECB is expected to hold off on further stimulus but is seen standing by last month's forward guidance, expecting rates to stay at 0.5 percent or lower for an "extended period". "When the euro has risen, ECB Governor (Mario) Draghi often tries to rein it in. I suspect a euro around $1.33 would be a burden for euro zone countries other than Germany. So he may try to talk down the euro a bit," said Mitsubishi Bank's Uchida. The big mover was the Australian dollar, which skidded towards 89 U.S. cents in thin trade, reaching its lowest in three years. The Aussie fell as far as $0.8910 on Wednesday and was on track to end the week down more than 3 percent. Although the currency drew some comfort from the Chinese manufacturing data, it remained vulnerable at $0.8949, flat on the day, with the next major level seen at the August 2010 trough of $0.8770. Traders said stops were triggered below 88.00 yen , which took the Aussie to 87.42 yen, it lowest level this year. That sell-off weighed heavily on the commodity currency broadly. The Aussie was already having a bad week following dovish comments from Reserve Bank of Australia (RBA) Governor Glenn Stevens on Tuesday, which led the market to not only price in a cut in rates next week, but a second easing before year-end. "The Aussie is clearly on its knees, in particular we think Stevens gave the green light for the currency to go lower," said Su-Lin Ong, senior economist at RBC in Sydney. "When you get that and generally disappointing Chinese data, the U.S. continuing to point towards a pick up in the economy, it's a whole confluence of factors that keeps downward pressure on the currency." Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: Japanese net buying of foreign bonds slows in latest week

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Japanese net buying of foreign bonds slows in latest week Aug 1st 2013, 02:08 Tweet Share this Email Print Related Topics Stocks » Currencies » Bonds News » Bonds » Markets » Wed Jul 31, 2013 10:08pm EDT * Japan investors mark longest net foreign bond-buying streak since Nov * Foreigners turn net sellers of Japan shares after 5 weeks of buying TOKYO, Aug 1 (Reuters) - Japan's longest foreign bond-buying binge since November continued last week, according to data released on Thursday, but Japanese investors' appetite for overseas debt faded. Japanese buyers took in a net 233.2 billion yen ($2.37 billion) of foreign bonds in the week through July 27, the fourth straight week of net purchases, capital flows data compiled by the Ministry of Finance showed. But net buying slumped from 601.4 billion yen in the previous week and 1.109 trillion yen the week before, which was the largest amount since September 2012. Some Japanese investors looked for higher returns abroad as the Bank of Japan's aggressive monetary easing policy has put a lid on domestic bond yields. The benchmark 10-year Japanese government bond yield touched a two-month low of 0.770 percent brushed last week, and has mostly stuck to a narrow 0.80 percent to 0.90 percent range since late May. By contrast, the yield on the benchmark 10-year U.S. Treasury note is trading above 2.5 percent, on perceptions that the U.S. Federal Reserve is likely to begin tapering the $85 billion in mortgage and Treasury securities it buys each month to stimulate the U.S. economy. However, the U.S. central bank offered no signs at its latest meeting that such a tapering was imminent. "The taper story came in May and then continued into June, and then in July didn't have much development," giving Japanese investors less incentive to buy U.S. debt, said Maki Shimizu, senior strategist at Citigroup in Tokyo. "I'm rather surprised that they're still buying because there is a risk that yields [on U.S. Treasuries] can jump from 2.5 percent," she added. The weekly capital flows data also revealed that foreign investors turned net sellers of Japanese stocks last week, breaking a five-week buying trend by unloading a net 61.8 billion yen worth of shares. The Nikkei stock average shed 0.1 percent in July, falling for a third month. The ministry's weekly data is based on surveys of financial institutions and does not break down the flows by destination or specific investment instruments. Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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Reuters: US Dollar Report: GLOBAL MARKETS-Tense for China test, after Fed settles nothing

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GLOBAL MARKETS-Tense for China test, after Fed settles nothing Jul 31st 2013, 23:39 SYDNEY | Wed Jul 31, 2013 7:39pm EDT SYDNEY Aug 1 (Reuters) - Asian markets got off to an indecisive start on Thursday after the Federal Reserve provided little clarity on the outlook for U.S. stimulus, leaving investors hostage to Chinese data later in the session. The official measure of Chinese manufacturing activity, due at 0100 GMT, is forecast to dip to 49.9 in July from 50.1 in June. Markets, however, fear risks are to the downside given the run of disappointing data recently. Analysts at Australia and New Zealand Bank look for a fall to 49.7. "Manufacturers' order books are still quite thin," they wrote in a note. "In addition, liquidity conditions turned tight again towards the end of July, which may constrain commercial banks' capacities to extend credit to the economy." A downside surprise would pressure stocks and currencies across the region while also unsettling commodity prices. Especially vulnerable is the Australian dollar, as China is the country's single biggest export market. The currency was already under heavy fire having skidded to a three-year trough at $0.8910 early Thursday. Dealers reported particularly heavy stop-loss selling against the yen which saw the Aussie at its lowest for the year so far around 87.40 yen. The currency has been undermined by widespread expectations the Reserve Bank of Australia (RBA) will cut interest rates to a record low of 2.5 percent next week. Other major currencies were mostly steady, with the dollar pinned at 97.83 yen, and the euro holding at $1.3294 after fading from a $1.3344 high overnight. Policy meetings at the European Central Bank and the Bank of England could see both reaffirm their forward guidance that rates will stay low for an extended period, perhaps to the benefit of the U.S. dollar. Wall Street stocks had ended Wednesday near flat after the Fed said it will continue to buy $85 billion in assets per month and made no mention of when it might start to taper its purchases. Investors took the Fed's statement as slightly dovish, which helped most commodities make small gains while Treasury yields reversed an early rise. Gold steadied at $1,325 an ounce after a whippy session on Wednesday saw it fall as low as $1,305.30 at one point. Oil markets put in another firm performance with U.S. crude at $105.14 a barrel, after rising around 2 percent on Wednesday. MARGINALLY DOVISH Stocks and commodities had been supported by data that showed the U.S. economy grew an annualised 1.7 percent in the second quarter, beating forecasts of a 1.0 percent rise. However, growth in the previous four quarters was revised down and the overall impression was of a sub-par performance. That point was acknowledged by the Fed in the handful of changes made to its policy statement. It characterised growth as "modest" rather than moderate and recognised the risk that inflation could go too low. "As a new addition to the statement, it does count as a very minor, marginally dovish change to the official line," said Martin McMahon, an economist at Commonwealth Bank of Australia. Yet while Treasury yields dipped slightly on the statement, the market still suspects the Fed to will start slowing the pace of stimulus sooner rather than later. "We continue to expect tapering of the open-ended asset purchases to commence in the autumn, probably already following the September 18th FOMC meeting. If not, then certainly before year-end," added McMahon. Much might depend on what the U.S. payrolls report shows on Friday. Forecasts favour a solid increase of 184,000 with perhaps a chance of an upside surprise after the ADP survey showed private jobs rose 200,000 in July. Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: TABLE-Foreign brokers set to sell Japanese stocks

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TABLE-Foreign brokers set to sell Japanese stocks Jul 31st 2013, 23:38 Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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Reuters: US Dollar Report: FOREX-Dollar slips after dovish Fed, Aussie slugged ahead of China data

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FOREX-Dollar slips after dovish Fed, Aussie slugged ahead of China data Aug 1st 2013, 00:13 Wed Jul 31, 2013 8:13pm EDT * Dollar softer after Fed gives no stimulus exit details * Aussie plumbs 3-year lows ahead of China PMI data * ECB, BoE meetings expected to keep forward guidance on rates By Ian Chua SYDNEY, Aug 1 (Reuters) - The U.S. dollar wallowed at six-week lows against a basket of major currencies on Thursday, having slipped overnight after the Federal Reserve gave no fresh hint that it was preparing to scale back stimulus at its next meeting in September. The Fed said it would keep buying $85 billion in mortgage and Treasury securities per month and noted the potential dangers of inflation running too low, a dovish tone that disappointed dollar bulls looking to the U.S. central bank's easy money stimulus to wind down soon. Many economists expect the Fed would begin slowing its asset-buying programme as early as next month, especially in light of data showing U.S. economic growth was not quite as weak as expected in the second quarter. "The Fed sounded a bit more dovish on the economy... just enough to keep the dollar from going too far on the back of stronger data. In fact, you saw yields in the U.S. go lower overnight. That leaves us still waiting for other major central banks," said Greg Gibbs, senior strategist at RBS in Singapore. The dollar index, which tracks the greenback's performance against a basket of major currencies, last stood at 81.654 , having fallen 0.2 percent on Wednesday. The euro reached a six-week high around $1.3345 overnight, while the dollar dipped to a one-month low of 97.585 yen. The common currency has since eased back to $1.3304 with investors wary of getting too carried away ahead of the outcome of policy meetings at the European Central Bank and Bank of England later on Thursday. The ECB is expected to hold off further stimulus but is seen standing by last month's forward guidance, expecting rates to stay at 0.5 percent or lower for an "extended period". NO RELIEF FOR AUSSIE The big mover was the Australian dollar, which skidded towards 89 U.S. cents in thin trade, reaching its lowest in three years. The Aussie fell as far as $0.8910 and was on track to end the week down more than 3 percent. It last traded at $0.8949, with the next major level seen at the August 2010 trough of $0.8770. Traders said stops were triggered below 88.00 yen , which took the Aussie to 87.26 yen, it lowest level this year. That sell-off weighed heavily on the commodity currency broadly. The Aussie was already having a bad week following dovish comments from Reserve Bank of Australia (RBA) Governor Glenn Stevens on Tuesday, which led the market to not only price in a cut in rates next week, but a second easing before year-end. "The Aussie is clearly on its knees, in particular we think Stevens gave the green light for the currency to go lower," said Su-Lin Ong, senior economist at RBC in Sydney. "When you get that and generally disappointing Chinese data, the U.S. continuing to point towards a pick up in the economy, it's a whole confluence of factors that keeps downward pressure on the currency." Traders said any disappointment in China's official manufacturing activity data at 0100 GMT could keep the Aussie under pressure. China is Australia's biggest export market. Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: CANADA FX DEBT-C$ advances as Fed keeps stimulus in place

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CANADA FX DEBT-C$ advances as Fed keeps stimulus in place Jul 31st 2013, 20:33 Tweet Share this Email Print Wed Jul 31, 2013 4:33pm EDT * C$ at C$1.0272 vs US$, or 97.35 U.S. cents * Canada's GDP grew 0.2 pct in May * U.S. Q2 GDP grew 1.7 pct annualized * C$ hits strongest level against Aussie in more than 3 years By Solarina Ho TORONTO, July 31 (Reuters) - The Canadian dollar strengthened against the U.S. dollar on Wednesday, recouping early losses, after the U.S. Federal Reserve offered no indication it will rein in its bond-buying stimulus program at its September meeting. The U.S. central bank said after a two-day meeting that it would keep buying $85 billion in mortgage and Treasury securities per month in its effort to strengthen an economy that it said was still challenged by budget-tightening. "It's the right thing for them do at this stage. They're essentially reinforcing the message that they're data dependent and they aren't going to act in a rash, hurried fashion," said Derek Holt, an economist at Scotiabank. "That, to me, says the decision on tapering is late-year at the earliest ... The Canadian dollar strength would keep the Bank of Canada relatively cautious for a period as well." The Canadian dollar finished the North American session at C$1.0272 versus the U.S. dollar, or 97.35 U.S. cents, up from Tuesday's close of C$1.0302, or 97.07 U.S. cents. It retreated as far as C$1.0337, or 96.74 U.S. cents, early in the day after the GDP data was released. Canadian gross domestic product grew by 0.2 percent in May from April, a lower-than-forecast figure that trimmed expectations for second-quarter GDP. The median forecast in a Reuters survey was for 0.3 percent growth, ahead of what is expected to be a poor June reading due to floods in Alberta and a construction strike in Quebec. But U.S. economic growth unexpectedly accelerated during the second quarter, expanding at a 1.7 percent annual rate and laying a firmer foundation for the rest of the year. "A pleasant surprise on the upside for U.S. growth prospects heading into what is expected to be even stronger growth in the second half of the year," said Craig Wright, chief economist at Royal Bank of Canada. The Canadian dollar outperformed most other major currencies and touched its strongest level against the Australian dollar in more than three years. Government bond prices were mostly higher across the maturity curve. The two-year bond rose 5.5 Canadian cents to yield 1.155 percent, while the benchmark 10-year bond climbed 53 Canadian cents to yield 2.453 percent. Tweet this Link this Share this Digg this Email Reprints Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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Reuters: US Dollar Report: GLOBAL MARKETS-U.S. stocks end mixed following Fed; dollar falls

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GLOBAL MARKETS-U.S. stocks end mixed following Fed; dollar falls Jul 31st 2013, 20:42 Wed Jul 31, 2013 4:42pm EDT * Fed keeps stimulus on track, U.S. stocks near flat in volatile session * U.S. GDP tops estimates; euro zone employment improves * Dollar lower on loose central bank policies NEW YORK, July 31 (Reuters) - Wall Street stocks ended a volatile session near flat and the dollar surrendered gains on Wednesday after the U.S. Federal Reserve offered no indication that a reduction in the pace of its stimulus program is imminent. The Fed said it will continue to buy $85 billion in mortgage and Treasury securities per month in its ongoing effort to bolster an economy still challenged by federal budget-tightening and weak growth overseas. Stocks were up before the release of the Fed's policy statement, bolstered by data that showed the U.S. economy grew more quickly than expected in the second quarter. U.S. economic growth, as measured by gross domestic product, accelerated in the second quarter by a 1.7 percent annual rate, the government said. Economists had expected a 1.0 percent gain. The dollar had risen on the data, which drove expectations that the Fed would start to scale back its assets purchases this year. But the Fed announcement trimmed most of those gains, though the U.S. currency remained higher against the yen. "The Fed continues to try to talk down the concerns of kind of a premature taper. In fact, there were even tones in this piece that were a little disinflationary," said Burt White, chief investment officer at LPL Financial in Boston. The Dow Jones industrial average was down 21.05 points, or 0.14 percent, at 15,499.54 at the unofficial close, weighed by American Express. The Standard & Poor's 500 Index was down 0.23 point, or 0.01 percent, at 1,685.73. The Nasdaq Composite Index was up 9.90 points, or 0.27 percent, at 3,626.37. The Fed's stimulus is seen by many as central to the S&P 500's gain of nearly 19 percent so far this year. It was the 10th straight session in which the S&P 500 traded within 10 points of the 1,700 level, considered key resistance for the U.S. market. The Nasdaq touched a near 13-year high at the session peak. On Thursday, attention will switch to the European Central Bank and Bank of England policy meetings and data on global manufacturing, followed by the U.S. monthly employment report on Friday. Signs the developed world's central banks will keep monetary policy loose for a long time to support a tentative economic recovery have put many equity and commodities markets on course for their best month of the year in July. But strategists have also cautioned that the gains, which pushed the MSCI World Equity index to its best monthly rise, a gain of 4.8 percent, since January 2012, have increased the risk that investors could find reasons over the next few days to cash out. "At the least what we expect is a lot more volatility and we think the volatility comes with a bit more downside risk than upside potential," said Wouter Sturkenboom, investment strategist at Russell Investments in London. EUROPEAN STOCKS RISE In Europe, stock market gains were underpinned by data showing the number of people out of a job in the euro zone fell for the first time in more than two years in June. Europe's broad FTSEurofirst 300 index closed up 0.2 percent for its best month since June 2012. The dollar fell 0.2 percent against the yen while the euro gained 0.3 percent against the dollar. The dollar index fell 0.2 percent. Much of the dollar's strength in recent months was on the expectation that the Fed was closer to paring back stimulus than not. "Today's FOMC statement maintains the Fed's maximum flexibility on quantitative easing," said Joseph Trevisani, chief market strategist at WorldWideMarkets, in Woodcliff Lake, New Jersey. "The end of the program was never going to be a cut and dried announcement in the official policy statement but in the various pronouncements of Chairman Bernanke." Prices for U.S. Treasuries reversed early losses to trade higher after the Federal Reserve statement. The benchmark 10-year note rose 7/32 in price to yield 2.58 percent after the statement. German Bund futures hit session lows after the U.S. data , falling as low 141.82, but were last up 0.3 percent at 142.91 after the Fed statement. GOLD Gold fell 0.4 percent. But it is still up 7.2 percent for the month, snapping a three-month losing run and marking its biggest monthly rise since January 2012, though it is down 21 percent since the beginning of 2013. U.S. crude rose 2 percent to $105.16 a barrel, extending gains after the Fed statement. It had risen earlier on news that oil stocks at Cushing, Oklahoma, the delivery point for U.S. crude futures, are at their lowest since April 2012, according to data from the U.S. Energy Information Administration. Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: Peru's central bank sells $170 million as sol ends weaker

Reuters: US Dollar Report Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

Peru's central bank sells $170 million as sol ends weaker Jul 31st 2013, 18:51 LIMA, July 31 | Wed Jul 31, 2013 2:51pm EDT LIMA, July 31 (Reuters) - Peru's central bank sold $170 million in the local spot market on Wednesday and the local sol currency finished 0.32 percent weaker at 2.794/2.795 per dollar. The dollar made gains on unexpectedly strong U.S. economic growth in the second quarter and as local banks bought dollars to improve their positions. The sol has weakened more than 9 percent so far this year after appreciating to historically high levels in 2012 as investors sought better yields in emerging economies because of stimulus measures abroad.

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Reuters: US Dollar Report: GLOBAL MARKETS-U.S. stocks rise on Fed statement; dollar pares gain

Reuters: US Dollar Report Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

GLOBAL MARKETS-U.S. stocks rise on Fed statement; dollar pares gain Jul 31st 2013, 18:44 Wed Jul 31, 2013 2:44pm EDT * Fed keeps stimulus on track * U.S. GDP tops estimates; euro zone employment improves * Shares set for stellar July on loose central bank policies NEW YORK, July 31 (Reuters) - Wall Street stocks rallied while the dollar surrendered some gains on Wednesday after the U.S. Federal Reserve offered no indication that a reduction in the pace of its stimulus program is imminent. The Fed said it will continue to buy $85 billion in mortgage and Treasury securities per month in its ongoing effort to bolster an economy still challenged by federal budget-tightening and weak growth overseas. Stocks were up before the release of the Fed's policy statement, bolstered by data that showed the U.S. economy grew more quickly than expected in the second quarter. U.S. economic growth, as measured by gross domestic product, accelerated in the second quarter by a 1.7 percent annual rate, the government said. Economists had expected a 1.0 percent gain. The dollar had risen on the economic data, which drove expectations that the Fed would start to scale back its assets purchases this year, but the Fed announcement axed most of those gains though the U.S. currency remained higher against the yen. "The Fed will maintain its asset purchases until it sees labor market improvement, and it will maintain an accommodative policy after the purchases end," said Wayne Kaufman, chief market analyst at Rockwell Securities in New York. "The Fed is saying that even when it tapers it doesn't want to see interest rates shoot up." The Dow Jones industrial average was up 30.33 points, or 0.20 percent, at 15,550.92. The Standard & Poor's 500 Index was up 6.04 points, or 0.36 percent, at 1,692.00. The Nasdaq Composite Index was up 17.60 points, or 0.49 percent, at 3,634.06. On Thursday, attention will switch to the European Central Bank and Bank of England policy meetings and data on global manufacturing activity, followed by the U.S. monthly employment report on Friday. Signs the developed world's central banks will keep monetary policy loose for a long time to support a tentative economic recovery have put many equity and commodities markets on course for their best month of the year in July. But strategists have also cautioned that the gains, which could cause the MSCI World Equity index to post its best monthly rise since January 2012, have increased the risk that investors could find reasons over the next few days to cash out. "At the least what we expect is a lot more volatility and we think the volatility comes with a bit more downside risk than upside potential," said Wouter Sturkenboom, investment strategist at Russell Investments in London. EUROPEAN STOCKS RISE In Europe, stock market gains were underpinned by data showing the number of people out of a job in the euro zone fell for the first time in more than two years in June. Europe's broad FTSEurofirst 300 index closed up 0.2 percent and had its best month since June 2012. The dollar was up 0.2 percent against the yen while the euro gained 0.1 percent against the dollar. The dollar index was last little changed. "Today's FOMC statement maintains the Fed's maximum flexibility on quantitative easing," said Joseph Trevisani, chief market strategist at WorldWideMarkets, Woodcliff Lake in New Jersey. "The end of the program was never going to be a cut and dried announcement in the official policy statement but in the various pronouncements of Chairman Bernanke." Prices for U.S. Treasuries pared losses on Wednesday after the U.S. Federal Reserve concluded a two-day meeting with a statement offering no indication that it will soon slow its bond-buying stimulus program. The benchmark 10-year note fell 9/32 in price to yield 2.641 percent after the statement. German Bund futures hit session lows on Wednesday after the U.S. data, falling as low 141.82, but were last up 0.2 percent at 142.71 after the Fed statement. CHINA FEARS Earlier in Asian trading, MSCI's Asia-Pacific ex-Japan share index slipped 0.6 percent, bringing its losses so far this year to 5 percent as the region's markets suffer from fears that China's economy is slowing rapidly. A reading on manufacturing activity in China, the world's second-largest economy, due on Thursday is expected to show a contraction in July for the first time in 10 months, according to a Reuters poll. A recent run of weak Chinese data, which prompted a pledge from Beijing on Wednesday to keep growth stable in the second half of 2013, has also undermined commodities. Gold fell 1 percent. But it is still up 6.6 percent so far this month, on track to snap a three-month losing run and mark its biggest monthly rise since January 2012, though it is down 20 percent since the beginning of 2013. U.S. crude rose 1.6 percent to $104.77 a barrel, extending gains after the Fed statement. It had risen earlier on news that oil stocks at Cushing, Oklahoma, the delivery point for U.S. crude futures, are at their lowest since April 2012, according to data from the U.S. Energy Information Administration.. Link this Share this Digg this Email Reprints

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Reuters: US Dollar Report: EMERGING MARKETS-Latam FX little changed as Fed offers no tapering clues

Reuters: US Dollar Report Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

EMERGING MARKETS-Latam FX little changed as Fed offers no tapering clues Jul 31st 2013, 19:43 Tweet Share this Email Print Related Topics Currencies » Bonds News » Bonds » Markets » Wed Jul 31, 2013 3:43pm EDT RIO DE JANEIRO, July 31 (Reuters) - Latin American currencies were little changed on Wednesday, trimming most of their early losses, after U.S. policymakers offered no indication that they are about to cut back on stimulus measures that have been supporting appetite for high-yielding assets. Speculation that the U.S. Federal Reserve was about to taper its bond-buying program grew after data released early on the day showed the U.S. economy unexpectedly accelerated in the second quarter. The data showed U.S. gross domestic product expanded at a 1.7 percent annual rate in the second quarter, above the 1 percent rate forecast by economists and up from the first quarter's downwardly revised 1.1 percent expansion pace. The U.S. economic picture was also brightened by a report showing the U.S. private sector added 20,000 jobs in July. Latin American currencies have been selling off in recent weeks on fears that the Fed may soon cut back on its bond-buying program, which for years has provided a steady source of greenbacks seeking higher returns in emerging markets. But, at the end of its two-day meeting, the Fed said the economy is still in need of support and that it will keep buying $85 billion in mortgage and Treasury securities per month. * The Brazilian real was little changed at 2.2797 per dollar after sliding to as much as 2.3022 per greenback, its weakest level since April 1, 2009. * Also supporting the real was strong intervention by the central bank, which called three auctions to sell traditional currency swaps, derivative contracts that provide investors with protection against currency depreciation. * Brazil's central bank sold a total of 45,300 traditional currency swaps in the first two auctions but found no demand for the swaps offered at a third auction. The action suggested policymakers are not willing to allow the real to weaken past 2.3 per dollar. * The Mexican peso dropped 0.1 percent to 12.773 per dollar, after weakening more than 1 percent earlier. * The Chilean peso bucked the trend and ended 0.3 percent stronger before the Fed statement, supported by a rise in the prices of copper, the country's main export product. Latin American FX prices at 1925 GMT Currencies Daily YTD pct pct change Latest change Brazil real 2.2797 -0.03 -10.51 Mexico peso 12.7750 -0.11 0.70 Chile peso 513.4000 0.33 -6.76 Colombia peso 1894.0000 -0.20 -6.76 Peru sol 2.7940 -0.39 -8.70 Argentina peso 5.5050 -0.09 -10.76 Argentina peso 8.6000 0.35 -21.16 Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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