Collinson FX Market Commentary: October 10, 2012 - IMF rings bell

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John Adair

Collinson FX market Commentary: October 10, 2012

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The IMF set warning bells ringing around the globe reviewing global growth forecasts lower to levels not seen since 2009. The warning derive from Europe's inability to solve the debt crises, the fast approaching US Fiscal cliff and China growth slowing.

The EU crises stumbles on with nothing new from the Finance Ministers meeting and protests greeting Merkels Greek visit. The EURO suffered, with the gloomy prospects, down to 1.2865 and the GBP below 1.6000 after some disappointing Industrial and Manufacturing production data. In the US, the NFIB Small Business Optimism reported a further fall to 3 year lows.

Markets now await the kick off of earning season with Alcoa after the bell. Prospects are not good so the markets remains square.

Commodities remained steady despite pessimism, supporting the AUD above 1.0200 although the KIWI dropped to 0.8175 after a fall in Credit Card spending. Watch Eco-Political developments in Europe and Earnings in the US!

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Jonathan Hoare


Collinson FX market Commentary: October 9, 2012

US Markets were lightly traded with the Columbus Day holiday and little drama occurring in Europe. EU Finance Ministers meet this week and the ESM Bail-out mechanism commences.

The question is when Spain will sink the snout into the trough!? In EU economic data, German Exports and trade continued to improve but Industrial Production contracted 0.5%. Markets will be focused on the commencement of the all important earnings season kicking off with Alcoa tonight. Expectations are not high for earnings which have been a driver for equity and commodity markets.

The EUR slipped back to 1.2970 and the GBP 1.6030. Higher yielding currencies fared better with some positive news from China. The Services PMI rose to 54.3 from 52 and this has helped the AUD which broke above 1.0200 again and the NZD 0.8195.

Look for developments from the debt crises in Europe and earnings in the US to drive market direction while the Presidential Election is now a major distraction.

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