Walid Salh El Din

The single currency has found strength this week to get over 1.30 psychological level versus the greenback again as the markets have shrugged off the delay of reaching an agreement between Greece and its creditors from the private sector as they have done last week by ignoring downgrading the credit rating of 9 of the Euro area remembers and also the EFSF's bonds by S&P giving all of the EU countries a negative outlook driving the yield of the European bonds down further. But The EU Fin Ministers meeting yesterday has come out yesterday with a new warning to Greece that it shouldn't expect more funds for bailing it even though the country's economy is worsening to push the single currency below 1.30 again.  The single currency has already opened the week below 1.29 versus the greenback on the worries about the results of the negotiations between Greece and IIF on the fear of the possibility of failing again to reach an...

The pressure on the single currency continued in the beginning of this week versus the greenback as the fear of downgrading the credit rating of the EU countries has materialized by the end of last week by cutting the credit rating of 9 of the Euro area remembers by S&P giving all of the EU countries a negative outlook but Germany and Slovenia which has been cut by one notch like Slovakia, Malta, Austria and France which was having a triple A rating like Germany, Finland, Netherlander and Luxemburg who had been maintained with no change while Italy, Spain, Portugal and Cyrus have been cut by 2 notches as the credit rating downgrading risk was one of the elements which were weighing down on the single currency recently especially after S&P's warning on the 5th of last month by placing the credit ratings of 15 euro zone countries on negative credit watch. The reactions of the EU Members were mixed. While Germany has...

The single currency could find the power to get over 1.30 versus the greenback because of the flash release of Dec EU manufacturing PMI index which has come at 46.9 while it has been expected to be 46.2 from 46.4 in November and also the flash reading of Dec EU Services PMI index which rose up to 48.3 from 47.5 in November while it was expected to decline further in the shrinking territory below 50 to 47.1 but the single currency has eased back below 1.30 as it is still finding difficulty to have a place above it after breaking it  yesterday as the uncertainty is still remaining about the crisis outlook as the market participants have not found out what can make them sure about that the worst of the debt crisis is over while the signs of the recession are still emerging in the Euro area The single currency has reached  yesterday 1.2945 versus the greenback by a new...

The Single currency is still under pressure versus the greenback after the ECB's interest rate decision of cutting the interest rate by 0.25% to be at its previous all times low at 1% again as it was before April meeting. The ECB kept its role as funds provider again with no announcement about new buying bonds plans directly which have been aimed by the markets which have seen offering new 3 years loans or lowering the EU reserve banking rate of deposits at its central banks by 50% to be 1% of its assets instead of 2% from the beginning of next year or even cutting the interest rate meanwhile are not enough and can not replace buying bonds directly by the ECB to restore confidence in the EU bonds markets to fall the risk appetite strongly during the ECB's president press conference which focused on the ECB's offering of cheaper money with no reference to direct interventions injecting funds in...

While the markets were waiting for the European Economic and Financial Affairs Council meeting results, The Single currency has managed to ease back again versus the greenback under the pressure of having €2.5B EU Trade Balance deficit in July while the markets were waiting for €1.7B surplus from €1.5B deficit in June after it had failed to get over its previous resistance at 1.3935 falling below 1.377 whereas it has started its rising following the news of offering 3 months loans by the ECB for the European banks in an coordinated action with the Fed, SNB, BOE and BOJ for underpinning the US dollar liquidity into the European banking system for longer time as this has been allowed for just one week by the ECB. God willing, further EURUSD declining can meet over the short term supporting levels at 1.3702, 1.3635, 1.3554 then 1.3494 again whereas it has started to correct its loses reaching the current levels and the breaking of...

The falling of EU Manufacturing PMI of August below 50 in the contracting territory to 49 while the markets were waiting for 49.5 from 50.4 in July raised the markets worries about the growth outlook in the Euro zone showing its needs for stimulation while it's required currently from most of the Euro zone countries to implement governmental austerities plans cutting its spending and raising its taxes for improving their financial situation amid continued investors' concerns about the debt crisis in the Euro zone. These weak manufacturing data have come in line with the falling of Aug Germane IFO last week to 108.7 while the markets were waiting for from decreasing to 111.3 from 112.9 in June following the big drop of Aug EU ZEW to -40 while the consensus was referring to improving to -7.6 from -7 in July and also this week earlier release of EU consuming confidence index falling to -17 in August while it has been forecasted...

The Swiss frank has started the week under pressure, as the equities markets gains last Thursday and last Friday have continued in the beginning of this week too supported by the stronger than expected release of Q2 GDP preliminary reading of Japan which has shown shrinking by 1.3% y/y while the markets were waiting for the double of this rate by 2.6% and this optimism has continued into the US session helping the US stocks indexes eliminating all its loses after 5th of August following the US long term debt downgrading by S&P to AA+ from AAA. In the same time, the investors have managed to take the SNB's worries about the Swiss Frank appreciation seriously with the SNB threatening the markets by taking further easing steps to stave off this appreciation after cutting the interest rate by 0.25% on 3rd of August to be zero despite the rising of Swiss SVEM PMI to 53.5 of July from 53.4 in June...

The Markets are waiting now for the ECB's interest rate decision which is widely expected to be for keeping the interest rate unchanged at 1.5% following July hiking by 0.25%, after easing of July EU CPI preliminary reading to 2.5% from 2.7% in June and the market will be focusing on the ECB's president language in the press conference following the decision to know whether or not it will maintain its view that the prices risks are still to the upside or not while it's widely expected to see turning back to the mantra that the ECB isvery closely watching the priceswhich always hints to the markets that there is no close rate hike decision from saying thatstrong vigilance is warranted which always refers to a coming hiking decision. The single currency is trading now at 1.423 versus the greenback after the release of June Germane Factor orders which have shown rising monthly by 1.8% as a the same as May...

The markets are waiting for having more information about the US housing market today with the release of US housing starts of June which are expected to be 0.58M in June from 0.56 in May and also US building permits which are expected to be 0.61M in June from .612 in May while the equities markets seem to be rebounding this morning after strong selling in the recent days because of the markets growing worries about the US debt following warning of downgrading the US credit rating by S&P and Moody's last week without exceeding the $14.29 trillions ceiling of US debt which has been already reached on 16th of last May as what has been announced by the Timothy Geithner. These warning could contain the market sentiment with no reached deal yet between Obama and the majority of US Congress republic party senators who are asking for cutting the governmental spending by at least 2 trillions before accepting this request...

The gains of the US stocks could continue today after the Greek parliament had passed the planned austerities measures by the Greek government which had the acceptance of EU and IMF for giving Greece the second part valued 12 billions euros from their planned 110 billions euros nearly a year ago for supporting it. This required step by the lenders was very important for restoring back confidence in the markets which have suffered by the worries about the Greek debt recently as it is to help Greece to avert default over the short term because of the lenders insistence on having an agreement in the Greek parliament on these required measures in the forms of cutting the governmental spending, hiking the taxes and going forward in privatization public assets in Greece by lending it more funds. This acceptance could calm down the concerns about other European ailing economies by debt in the euro area such as Irelandand Portugalwhich required the IMF and...