Daily review of the market. by OpenForex.com

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NEWS / Forex Forecasts

Daily review of the market.

12:51 08/05/2004

Daily review of the market. Investors activity is rather low now, as we are expecting Friday report on the Labor market in the U.S. On Wednesday, the dollar was trading within a tight range against major currencies. The fact that oil prices hit new record and American stock exchange indexes fell put the pressure on the rate of the dollar. National security concerns proved to be against the dollar and investors preferred buying the Euro and Swiss franks. At the same time, the rate of the Euro is negatively affected by rise in number of unemployed in Germany and by stability of PMI indicator in Europe (12). But processing industry’s indicators’ rise and increase in the volume of auto sales in the U.S. prove that country’s economy is recovering, thus supporting the rate of the national currency. The U.S. Department of Trade reports that factory orders rose 0,7% in the U.S. in June compared to gain in 0,4% in May. Analysts had looked for gain in 0,5% in factory orders. The Institute for Supply Management services index rose to 64,8 points in July from 59.9 points in June. Real estate market situation in Britain negatively affects the rate of pound sterling. Housing prices increase by 1,3% m/m in Britain in July, thus rising from 1.2% in June. In Germany, ISM index rose from52.3 in June to 53,9. Average forecasts presupposed that the given index had to equal 52.5. In France, ISM index dropped to 55.1 in July from 57.9 in June. Forecasts read that the given indicator was to equal 58.0. In Eurozone, ISM index remained the same, which is as forecasted. In July, PMI made up 55.3, not having changed since June. New orders dropped from 55.1 to 54.7, though expected to be 65.2, having increased from June’s 64.7. Subindex of employment increased from 49.9 in June to 49.3 in July. In Britain, ISM index for June made up 56.2, having dropped from June’s 56.8. Analysts forecasted that PMI would equal 56.5. New orders index decreased to annual minimum of 56.5 from 57.1 in June, whereas index of unused business opportunities made up 74.6, rising from 77.3 in June. Initial prices index dropped from 60.9 to 58.4. Employment rate index increased to 52.9 in July compared to 51.5 in June. Bundesbank reports that summary unemployment rate made up 10.6% in July against 10.5% in June. Bundesbank notes that summary unemployment level equals 4.386 million in July, having dropped from the revised 4,375 million in June. That means that summary unemployment rate for Western Germany made up 8.5% in July, increasing from 8.4% in June. Unemployment level in Western Germany made up 2.788 million, having risen from 2,773 million in June. For Easter Germany, unemployment rate made up 18.5% in July, not having changed since June, whereas unemployment level made up 1.598 million, thus decreasing from 1.602 million in June.

The forecast was created by trans1.