What’s Happening With Currencies – October 26, 2011
Major currencies are up on the day as expectations run high of a European resolution – scheduled be announced at midday in New York today. As a result, both the Euro and British pound are trading higher, with the US Dollar Index trading just above the 76.00 level. UK manufacturing sentiment continues to remain pessimistic as US durable goods orders were released to a mixed reception. Gold is also higher – rising above $1,700 a troy ounce at $1,716.70, up almost 1% on the day.
1. Manufacturing conditions remained under pressure in October according to the CBI industrial trends survey. Report results show a decline of -18 in total orders, as the expectations component of the report fell to a -30 reading – far below September’s -16.
2. Business sentiment in New Zealand also dropped, falling for the third consecutive month in October. The ANZ released report showed a 13.2% compared to last month’s 30.3% reading.
3. Crucial for the passing of new European measures to stave off a growing regional crisis Germany’s lower house of parliament passed measures to expand the current EFSF – in a vote of 503 out of 596. The passing gives German Chancellor Angela Merkel some leeway in discussions with other European leaders today in Brussels.
4. US durable goods orders fell in September, to the tune of 0.8%. The month over month decline was slightly better than estimates of a 1% drop, but remained negative against August’s -0.1% reading. Core goods skyrocketed by 1.7%, compared to estimates of a 0.4% climb.
5. Consumer prices in Australia dropped as expected in the third quarter, declining by 0.6%. The quarterly figure dragged the annualized number lower to 3.5% from 3.6% previously.
6. US new home sales rose better than expected to a five month high according to the US Commerce Department today. In the month of September, sales gained by 5.7% to a pace of 313,000 homes annually.
7. With the European decision imminent this afternoon, the Dow Jones Industrial Average remains higher – trading up by 0.76% at 11,795.80. The broader S&P 500 has gained by 0.29% to trade at 1,232.57.