MORNING BRIEFING: Virtual bankruptcy of the State of California weighing on the greenback. Russia calls for a new international currency of foreign ex

[RTFX-Trading]

MORNING BRIEFING: Virtual bankruptcy of the State of California weighing on the greenback. Russia calls for a new international currency of foreign exchange reserves.

What’s new?
Germany: Economic sentiment on the rise according to ZEW survey.
Euro zone: Inflation falls to zero in May for the first time since the creation of the Euro.
Switzerland: Industrial orders in free fall in the first quarter.
United States: White House refuses to help California.
BRIC: Russia calls for a discussion on the reserve currencies, China silent.
G7: The 250 economists surveyed are less optimistic than the market.
United States: Industrial production down more than expected in the month of May.
United States: Rise in Producer price index is less than expected.
United States: Housing Starts increase by 17% in May.

Today:
09h15 Switzerland: Retail Sales April Y/Y, previous 1.20%.
10h30 United Kingdom: Jobless Claims Change May, exp 60’000, previous 57’100.
10h30 United Kingdom: ILO unemployment rate May, exp 7.30%, previous 7.10%.
11h00 Switzerland: ZEW Investor Sentiment June, previous -3.9.
13h00 United States: MBA Mortgage Applications, previous 611.0.
14h30 United States: Consumer Price index May M/M, exp 0.30%, previous 0.00%.
14h30 United States: Consumer Price index Ex Food and Energy May M/M, exp 0.10%, previous 0.30%.
14h30 United States: Current Account Q1, exp -$85B, previous -$132.8B.
14h30 Canada: Leading Indicators May, exp -0.60%, previous -1.10%.

Overnight Rates and Indices:
EURUSD: 1.3886 – 1.3807.
USDCHF: 1.0907 – 1.0851.
GBPUSD: 1.6445 – 1.6354.
EURJPY: 134.19 – 132.55.
USDJPY: 96.71 – 95.97.
DowJones: 8’505 -1.25%.
NASDAQ: 1’817 -2.28%.
S&P 500: 912 -1.27%.
Nikkei: 8’809 +0.58%.
Gold: $934.
 Crude Oil: $70.80.
 
Comments:

The figures published yesterday morning were contradictory. Two figures were negative for the economy: Inflation in the Euro area fell to zero in May for the first time since the creation of the single currency and Industrial orders in Switzerland in free fall in the first quarter. The good news is that the economic sentiment of analysts and investors in Germany has improved more than expected in June, reaching its highest level since summer 2006.

However, the greenback suffered from the intentions of Russia to promote the creation of a new international reserve currency at the expense of the US Dollar. The almost bankrupt State of California is also worrying investors. According to California governor Arnold Schwarzenegger, the state could be in a state of bankruptcy in 2 months. The White House has refused federal assistance, thus leaving the largest American state unable to borrow...

As for new US economic figures, the data published yesterday was mixed. Unemployment figures in the UK, followed by the consumer prices index from the United States at 14h30 CET will headline today’s economic news.

Good Day

Emman Xuereb
RTFX Ltd
Head Office

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