MORNING BRIEFING: RBA raises rates for a third time, Euro still suffers amid concerns

[RTFX-Trading]

MORNING BRIEFING:  RBA raises rates for a third time, Euro still suffers amid concerns

What’s new:
Euro Zone: Euro still trading low
Germany: Stronger year on year sales, but month on month sales sag
US Dollar: Finds support on stronger data
United states: Trade Commission rules against Chinese Companies
Australia: RBA raises rates for the third time this year


Today:



Rates in Asia and Indices:
EURUSD: 1.3214 - 1.3169.
USDCHF: 1.0878 - 1.0841.
GBPUSD: 1.5265 - 1.5212.
EURJPY: 125.46 - 124.70.
USDJPY: 94.98 – 94.53.
DowJones: 11'151.83 +1.30%
NASDAQ: 2'498.74 +1.53%
S & P 500: 1'202.26 +1.31%
Nikkei: closed  
Shanghai 2’846.24 -0.85%  
Gold: $ 1'180.85
Crude Oil: $ 88.60
 
Comments:

Steady demand for Australian Commodities has contributed considerably to the Australian Economic recovery. On Tuesday, amid signs that the economy is on a path to a sustainable recovery the Reserve Bank of Australia raised its policy cash rate for the third time this year by 0.25% to 4.5%. Some Analysts say it was a natural consequence of strong inflationary and housing data.

Euro traded near one year lows early Tuesday Morning amid concerns of the efficacy of the EU-IMF rescue package for Greece. RTFX Trader Tip indicates EURUSD is very likely to be bearish heading for a fall to 1.3116 levels. This is understandable given good data from United States on one side and never ending concerns on the Greek crisis on the other side. It is not only Greek aid that weighed on the Euro, earlier on this morning data for German retail sales were up 2.7% y.o.y but  fell 2.4% on a m.o.m basis, a sign that consumer sector continues to sag.

Stronger data from the United States yesterday contributed to a stronger US Dollar. Expectations are that the Federal Reserve will be raising its interest rates ahead of Europe and Japan later on this year.

The United States/ China saga continues as the US international Trade Commission ruled on Monday that Chinese companies sold USD 2.8bln worth of oil well drill pipe at unfairly low prices in the United States. As a result Commerce will issue an anti-dumping duty order on imports of these products from China. All this comes amid disputes over china’s huge surplus and the value of the Yuan.

Tuesday Tokyo is closed again, suggesting trades could be light.

Good Day.


Rudolf Muscat

Trading desk

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