| USDCHF, USDCAD Market was not ready for Bernanke’s unexpected comments that caused "abrupt dollar pique"... |
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15:26 04/28/2006 |
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"Ben Bernanke’s revelation" was unexpected for many market’s participants. We shall remind that yesterday in the Congress the Head of the US Central Bank Ben Bernanke did not exclude an opportunity to stop of interest rates increase.
FRS Head said that the further increase of interest rates in the USA would depend on macroeconomic statistics, and any moment there can be a pause in 22-month's campaign on monetary policy firming.
"FRS further actions will depend more and more on the forecast of economic development, which reflection are economic data" – Bernanke has declared. "Even if the risks, directed to the objects, will not be completely balanced, in future the Committee can decide not to make any steps at one or several meetings to win more time to get information... ", - FRS Head told.
Besides economic data in the USA, published yesterday, were weaker than the predicted levels and also put pressure upon a dollar exchange rate. Let's remind that jobless claims in the USA made 315.000 for a week on April, 22nd, at the forecast 305.000. Thus the previous value is revised from 303.000 to 304.000. Experts have noted that the parameter was worse than the forecast and reached a top level since March, 11th. And the average number of initial jobless claims for four weeks on April, 22nd grew up to 308.500 from 305.750 a week earlier. It was originally informed on 305.250. Thus the total number of jobless in the USA for April, 15th rose up to 2.449 million from 2.427 million a week earlier. It was originally informed on 2.439 million.
Another important indicator - Help-Wanted Index in the USA made 38 for March, at the forecast 39, and the previous value 39.
Let's notice that on the other hand, euro was supported against dollar by a member of ECB Governing Council Garganas, who declared yesterday that the risk of growth of inflation rate in the region increased. After his statement expectations of the further increase of rates in Europe (12) among the market’s players raised noticeably.
As a result instead of designating long felt correction the dollar "has fallen down abruptly". Experts notice that yesterday's comments of FRS Head Ben Bernanke only strengthened bear moods concerning dollar, prevailing earlier in the market. And the main driver, in analysts’ opinion, is expectation of "pause" in a cycle of the US rates increase, and also inactivity of the US government in the decision of a problem of structural disbalances, or rather, obvious weakness to change a situation cardinally.
Unfortunately, yesterday's Bernanke’s "surprise" stopped our cautious "longs". Such situations in trading happen often... We recommend now, being outside of the market, to wait for correction. The further strategic purpose in drop in dollar/franc rate is near levels 1.2000-50. However before the pair goes "strictly to the south", according to all market canons, we will see some ascending correction of a rate. Maybe it will happen today: we shall remind that Friday evening market - an optimum situation for similar recoil movements. The same situation with the dollar/canadian rate: being outside of the market, to wait for correction of a rate.
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