The European Central Bank left their benchmark rate unchanged at a record low 1.00% which was consistent with their recent rhetoric that rates are appropriate. Meanwhile, Euro-Zone unemployment reached a decade high of 9.5% in May following a revised 9.3% the month prior.
[B]Fundamental Headlines[/B]
• [I]Fissures Appear at New York Fed [/I]– Wall Street Journal
• [I]Oil Drops After US Inventory Increase[/I]– Financial Times
• [I]IMF Plans Debt Issuance for Bail-Outs[/I]– Financial Times
• [I]General Motors May File for IPO in 2010, Adviser to U.S. Task Force Says [/I]– Bloomberg
• [I]Employers in U.S. Probably Cut More Jobs as Stimulus Failed to Spur Hiring [/I]– Bloomberg
[B]EURUSD[/B] – The European Central Bank left their benchmark rate unchanged at a record low 1.00% which was consistent with their recent rhetoric that rates are appropriate. Meanwhile, Euro-Zone unemployment reached a decade high of 9.5% in May following a revised 9.3% the month prior. Additionally, May producer prices fell to a record low -5.8% from -4.6% led by a 0.3% drop in intermediate goods. A weak labor market and a deflationary environment will limit any prospect of a recovery for the region and may force President Trichet to consider further easing. Discuss the topic and your trade ideas in the EUR/USD Forum.
[B]GBPUSD[/B] – The BoE released its quarterly report on credit conditions which showed the supply of secured credit to households had increased but that unsecured credit was less available. Lenders also reported an increase in credit to the corporate sector which will help aide an economic recovery. However, new MPC member David Miles said that the banking sector is on life support and return of growth isn’t a probable outcome, despite slight improvement in housing. Also, the PMI construction report unexpectedly showed a decline in the sector to 44.5 from 45.9. Discuss the topic and your trade ideas in the GBP/USD Forum.
