News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • Heads Up:🇦🇺 Retail Sales MoM Final (JUN) due at 01:30 GMT (15min) Expected: -1.8% Previous: 0.4% https://www.dailyfx.com/economic-calendar#2021-08-04
  • The US Dollar could lose some ground against ASEAN currencies such as the Singapore Dollar and Thai Baht amid slowing Emerging Asia Covid case growth. Softer US NFPs may also bode well.Get your market update from @ddubrovskyFX here:https://t.co/jnJ80hQR4P https://t.co/n8UXm0mUeb
  • This week's non-farm payrolls (NFP) will likely be key to gauge the direction of gold as markets look ahead to the Jackson Hole Economic Symposium. Get your market update from @FxWestwater here:https://t.co/WmTrqe0xJN https://t.co/BO2uwXMAko
  • Will be discussing the Japanese #Yen and what you can expect throughout this week in about 15min! Signup for the webinar in the link below! https://t.co/Jbtd2hc5nU
  • Please join @ddubrovskyFX at 20:00 EST/00:00 GMT for a webinar on what other traders' buy/sell bets say about price trends. Register here: https://t.co/AzOQioRZER https://t.co/uy1tAhiwGY
  • RT @FxWestwater: $NZDUSD Wedge Breakout Back in Play on Stellar Q2 Jobs Report Link: https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2021/08/03/NZDUSD-Wedge-Breakout-Back-in-Play-on-Stellar-Q2-Jobs-Report.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr https://t.co/YAIqqu5RDB
  • 🇦🇺 Markit Services PMI Final (JUL) Actual: 44.2 Previous: 56.8 https://www.dailyfx.com/economic-calendar#2021-08-03
  • $AUDNZD likely to attempt closing at a new 2021 low over the remaining 24 hours following the stellar New Zealand jobs report The December 2020 low has been further exposed at 1.0418 since July's #RBNZ rate decision New Zealand bond yields on the rise https://t.co/ipjwkSNt9n https://t.co/ncQX4hL8G3
  • Strong jobs report lifts $NZD - Money markets pricing in a 93% probability of a 25bps hike at the August meeting (previously 77%) - Over the forecast horizon, the RBNZ had projected (in the May MPS) the unemployment rate to gradually fall to 4.3% https://t.co/G5Ejzl2H6L
  • #NZDUSD cautiously higher after solid New Zealand jobs report Unemployment rate declined to 4.0% in Q2 from 4.7% prior (vs 4.4% anticipated) Job gains were at 1.7% y/y vs 1.2% expected Data seems to be supporting the case for a less-dovish #RBNZ given the cease to QE recently https://t.co/XmzhuLXh1H
Euro Tanks, U.S. Dollar Surges on Bernanke Testimony

Euro Tanks, U.S. Dollar Surges on Bernanke Testimony

Christopher Vecchio, CFA, Senior Strategist

THE TAKEAWAY: [Fed Chairman Bernanke’s Semi-Annual Testimony ] > [Committee Critical of Dual-Mandate; Bernanke Less Dovish] > [USDollar Bullish]

Federal Reserve Chairman Ben Bernanke was on Capitol Hill today testifying in front of the Committee on Financial Services. Despite overall dovish undertones, the chairman’s testimony was markedly less-dovish than recent Federal Reserve communiqués, boosting the U.S. Dollar across the board.

At the time this report was written, the EURUSD had taken a dramatic spill, falling from 1.3460 to as low as 1.3370, at the time this report was written. Similar price action was observed across other U.S. Dollar-based pairs, in particular the AUDUSD and NZDUSD.The Dow Jones FXCM Dollar Index (Ticker: USDOLLAR) is trading higher on the developments, from 9740.41 to as high as 9809.01.

EURUSD 1-min Chart: February 29, 2012

Euro_Tanks_U.S._Dollar_Surges_on_Bernanke_Testimony1_body_Picture_2.png, Euro Tanks, U.S. Dollar Surges on Bernanke Testimony

Charts Created using Marketscope – Prepared by Christopher Vecchio

Chairman Bernanke, in his semi-annual testimony, noted that “the recovery of the U.S. economy continues, but the pace of expansion ‘has been uneven and modest’ by historical standards.” Going forward, the Federal Open Market Committee projects “growth in real GDP in 2012 [with] a central tendency of 2.2 to 2.7 percent, which are considerably lower than the proejctions made last June.”

In regards to unemployment, the chairman said that the “decline in the unemployment rate over the past year has been ‘more rapid’ than expected.” However, as he noted, “the job market remains far from normal…The unemployment rate remains elevated, long-term unemployment is still near record levels, and the number of persons working part time for economic reasons is very high.”

Presented below without commentary are other notes from the testimony:

On Economic Conditions

  • Private payroll employment has increased by 165,000 jobs per month on average since the middle of last year, and nearly 260,000 new private-sector jobs were added in January.
  • The job gains in recent months have been relatively widespread across industries. In the public sector, by contrast, layoffs by state and local governments have continued.
  • The unemployment rate hovered around 9 percent for much of last year but has moved down appreciably since September, reaching 8.3 percent in January. New claims for unemployment insurance benefits have also moderated.
  • Household spending advanced moderately in the second half of last year, boosted by a fourth-quarter surge in motor vehicle purchases that was facilitated by an easing of constraints on supply related to the earthquake in Japan.
  • In the housing sector, affordability has increased dramatically as a result of the decline in house prices and historically low interest rates on conventional mortgages.
  • On the supply side of the market, about 30 percent of recent home sales have consisted of foreclosed or distressed properties, and home vacancy rates remain high, putting downward pressure on house prices.
  • Manufacturing production has increased 15 percent since the trough of the recession and has posted solid gains since the middle of last year, supported by the recovery in motor vehicle supply chains and ongoing increases in business investment and exports.

On Monetary Conditions

  • The target range for the federal funds rate remains at 0 to 1/4 percent, and the forward guidance language in the FOMC policy statement provides an indication of how long the Committee expects that target range to be appropriate.
  • At the January 2012 FOMC meeting, the Committee amended the forward guidance further, extending the horizon over which it expects economic conditions to warrant exceptionally low levels of the federal funds rate to at least through late 2014.

View the full testimony

--- Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, send an e-mail with subject line "Distribution List" to cvecchio@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES