Fundamental Headlines • Senate Vote Gives Bailout Plan New Life – Wall Street Journal • GE Turns to Buffett for a $3 Billion Show of Confidence – Wall Street Journal • Europe split on bank rescue fund – Financial Times • Wachovia Limits Access to $9.3 Billion Fund for 900 Colleges – Bloomberg • UBS Has ‘Small’ Profit, Reduces Mortgage Holdings – Bloomberg • GBPUSD – The BoE’s third quarter credit conditions survey showed that availability of corporate credit was weaker than the bank had anticipated, which suggests that corporate borrowing may fall further, and the likelihood of corporate defaults will be higher in the fourth quarter. Furthermore, household secured lending defaults increased during the same period, signaling that credit conditions in the U.K. may weaken further as the economy is on the brink of a recession. However, the survey was conducted until September 17, which suggests that the figures could be overstating the current conditions in the credit market. Meanwhile, the construction PMI plunged to 38.8 from 40.5 in August, which suggests that the downturn in the housing sector will last longer than expected as banks continue to cutback on lending practices. Discuss the topic and your trade ideas in the GBP/USD Forum. • EURUSD – Euro-Zone producer price slipped to 8.5% from a revised reading of 9.2% in July, falling from an 18 year high on the back of falling oil prices. However, a deeper look into the report shows that prices excluding energy increased 0.2% in August, which suggests that upside prices pressures remain even as the economy is on the brink of a recession. Discuss the topic and your trade ideas in the EUR/USD Forum. • USDCHF – The economic forecast for Switzerland was downgrade in September as unemployment is expected to tick higher to 2.7% from an estimate of 2.6 in June, while exports are anticipated to slow to 2.3% from 2.8%. Furthermore, business investments are projected to stall after an expected gain of 3.0% in June, which suggest that economic activity may weaken further. For more news and resources, visit the new Swiss franc Currency Room.
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