China’s PMI as Expected, Sideways Currency Movement Ahead of Data Full Week | IFCM
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China’s PMI as Expected, Sideways Currency Movement Ahead of Data Full Week - 1.7.2013

Currency markets are still mildly moving with the US dollar slightly losing against its major peers ahead of an eventful US week. At the moment the USDJPY technical-analysis/usd-jpy hold its bullish tone from previous week, underpinned by Tankan positive data indicating more than projected growth in Manufacturing in the 2nd quarter and increase in industries capital expenditure. The USDJPY rose as high as 99.55 from 93.81 at the beginning of June returning to upside momentum, it is likely to be contained this week by psychological upside barrier at 100. In addition the NIKKEI 225 gained due to improved Tankan report, it advanced by 1.28% to close at 13,852.


Chinese Manufacturing PMI for June was slightly lower than previously but as expected at 50.1, with recent liquidity problems in small banks in China not yet solved also in previous period lower GDP growth and downgrade of future outlook are factors of squeezing traders risk appetite. Concerns over the second largest economy could easily trigger investors to put their money in safer place. The precious metal recovered from its 34th month low at 1181 after a reversal in the short-term, climbing back to 1245.


Looking ahead, European Manufacturing PMIs are expected and likely to shake a bit the European currency that is mostly in range around $1.30, later on EZ Unemployment Rate is expected to be reported at 12.3% for May, 0.1% higher than previous month. Towards the end of the week, ECB and BOE rate decisions are insight, US Jobless Claims will be released on Wednesday since it’s the 4th of July holiday on Thursday and on Friday are the Non-Farm Payrolls. Thus we do not expect clear trends by most US dollar based currencies due to uncertainty and thin trading.
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