{"id":1040,"date":"2012-06-11T06:10:00","date_gmt":"2012-06-11T06:10:00","guid":{"rendered":"http:\/\/starthostunlimiteddmffassi-ss.stackstaging.com\/bondworld.ch\/home\/sites\/20b\/7\/760c69a11c\/public_html\/investmentworld.ch\/index.php\/2012\/06\/11\/forex-markets-after-a-whole-month-on-the-rise-may-this-week-the-dollar-corrected\/"},"modified":"2012-06-11T06:10:00","modified_gmt":"2012-06-11T06:10:00","slug":"forex-markets-after-a-whole-month-on-the-rise-may-this-week-the-dollar-corrected","status":"publish","type":"post","link":"https:\/\/www.investmentworld.eu\/ch\/forex-markets-after-a-whole-month-on-the-rise-may-this-week-the-dollar-corrected\/","title":{"rendered":"Forex markets: After a whole month on the rise (May), this week the dollar corrected"},"content":{"rendered":"<p style=\"text-align: justify;\"><span lang=\"EN-GB\">The ECB meeting helped the euro, but the \u201cother\u201d challenges now lie ahead: Spanish banks and<\/span> Greece&#8230;.<span lang=\"EN-GB\">&#8230;<\/span><strong><span lang=\"EN-GB\"> <\/span><\/strong><span lang=\"EN-GB\"> <\/span><span lang=\"en-GB\"> <\/span><span lang=\"EN-GB\"><\/span><span lang=\"en-GB\"> <\/span><\/p>\n<p>  <!--more-->  <\/p>\n<ul> <\/ul>\n<hr \/>\n<p> <span style=\"font-family: arial,helvetica,sans-serif;\"><span style=\"font-size: 10pt;\"> Sign up for our free newsletter to receive weekly news from BONDWorld<br \/><a href=\"index.php?option=com_acymailing&#038;view=user&#038;Itemid=107\"><strong>Click  here to register for your free copy<\/strong><\/a><\/span> <span style=\"font-size: 10pt;\"><a href=\"index.php?option=com_acymailing&#038;view=user&#038;Itemid=1023\"><strong> <\/strong><\/a><\/span><\/span>  <\/p>\n<hr \/>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial,helvetica,sans-serif;\"><span style=\"font-size: 10pt;\"><strong>For professional investors and advisers only<\/strong><\/span><\/span><\/p>\n<hr \/>\n<div style=\"text-align: justify;\">\n<p class=\"MsoNormal\" style=\"text-align: justify;\"><strong><span lang=\"EN-GB\">USD- <\/span><\/strong><span lang=\"EN-GB\"><span> <\/span>(nominal  effective exchange rate) \u2013 After a whole month on the rise (May), this  week the dollar corrected. The increasing chance of the Fed having to  resume quantitative easing was one of the main reasons behind the  dollar\u2019s retracement, combined with a partial easing of risk aversion  (see section below on the euro and the ECB). A host of US data releases  are due next week \u2013 mostly expected to be poor \u2013 and Fed members will  also speak. The calendar of events should not necessarily penalise the  US currency, if not only modestly. In fact, the portion of risk aversion  tied to uncertainty weighing on US growth could shield at least in part  the dollar from important losses.<\/span><\/p>\n<p class=\"MsoNormal\" style=\"text-align: justify;\"><strong><span lang=\"EN-GB\">EUR \u2013<\/span><\/strong><span lang=\"EN-GB\"> The euro recovered from last week\u2019s lows in the EUR\/USD 1.22 area,  rising to around 1.26 on the day following the ECB meeting, but  ultimately slipped again, stopping in any case in the 1.24 area. The ECB  meeting benefited the single currency, as Draghi let on that the  central bank is ready to act using the tools at its disposal, if  necessary. The President of the ECB also made explicit reference to the  possibility of an interest rate cut. However, before the next ECB  meeting, the euro area will have to take on many other challenges,  starting with recapitalisation of the banking system in Spain, for which  the Spanish government seems set to formally request assistance over  the weekend. Elections in Greece will follow on Sunday, 17 June, and the  G20 summit on 18-19 June. Next week, the exchange rate trend will be  guided principally by news flows on Spain, Greece, and the euro area  crisis in general. Barring positive developments, downside pressures  could again prevail. However, in the absence of bad news, the euro  should not drop to new lows beyond the 1.2288 mark hit on 1st June. On  the other hand, favourable developments on Spanish banks could restore  the exchange rate to EUR\/USD 1.26.<\/span><\/p>\n<p class=\"MsoNormal\" style=\"text-align: justify;\"><strong><span lang=\"EN-GB\">GBP<\/span><\/strong><span lang=\"EN-GB\"> \u2013 Sterling also recovered from its recent lows at GBP\/USD 1.52, reaching a high ofGBP\/USD<\/span> 1.5601 in the wake of the BoE\u2019s announcement. <span lang=\"EN-GB\">The  BoE left rates unchanged and opted not to expand the APF. As downside  risks to growth mostly stem from the euro area crisis, the BoE probably  intends to await developments (impending) on that front. Therefore,  sterling\u2019s recovery should not be considered as definitive, and  disappointing data could push it back down to between GBP\/USD 1.54 and  1.52, and EUR\/GBP 0.8100 and 0.8200.<\/span><\/p>\n<p class=\"MsoNormal\" style=\"text-align: justify;\"><strong><span lang=\"EN-GB\">JPY<\/span><\/strong><span lang=\"EN-GB\"> \u2013 A partial easing of risk aversion, and the statements made by Azumi  on the damage caused by an excessively strong exchange rate, have  weakened the yen from USD\/JPY 77 to 79. The BoJ meeting is due next  week, on which occasion the Japanese authorities could make a firmer  stand \u2013 at least verbally \u2013 against the excessive strength of the  currency. Any upside reactions to unfavourable developments of the euro  area crisis should therefore be limited in scope and duration.<\/span><\/p>\n<\/p><\/div>\n<div style=\"text-align: justify;\"><\/div>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial,helvetica,sans-serif;\"><strong> <\/strong><\/span><\/p>\n<hr \/>\n<p> <span style=\"font-family: arial,helvetica,sans-serif;\"><strong> <\/strong><\/span> <\/p>\n<p style=\"text-align: justify;\"><strong><span style=\"font-family: arial,helvetica,sans-serif;\">Appendix<br \/>An<\/span>alyst Certification<\/strong><br \/>The financial analysts who prepared this report, and whose names and roles appear on the first page, certify that: (1) The views expressed on companies mentioned herein accurately reflect independent, fair and balanced personal views; (2) No direct or indirect compensation has been or will be received in exchange for any views expressed. Specific disclosures: The analysts who prepared this report do not receive bonuses, salaries, or any other form of compensation that is based upon specific investment banking transactions.<\/p>\n<p><strong>Important Disclosures<\/strong><br \/>This research has been prepared by Intesa Sanpaolo S.p.A. and distributed by Banca IMI S.p.A. Milan, Banca IMI SpA-London Branch (a member of the London Stock Exchange) and Banca IMI Securities Corp (a member of the NYSE and NASD). Intesa Sanpaolo S.p.A. accepts full responsibility for the contents of this report. Please also note that Intesa Sanpaolo S.p.A. reserves the right to issue this document to its own clients. Banca IMI S.p.A. and Intesa Sanpaolo S.p.A. are both part of the Gruppo Intesa Sanpaolo. Intesa Sanpaolo S.p.A. and Banca IMI S.p.A. are both authorised by the Banca d&#8217;Italia, are both regulated by the Financial Services Authority in the conduct of designated investment business in the UK and by the SEC for the conduct of US business.<br \/>Opinions and estimates in this research are as at the date of this material and are subject to change without notice to the recipient. Information and opinions have been obtained from sources believed to be reliable, but no representation or warranty is made as to their accuracy or correctness. Past performance is not a guarantee of future results. The investments and strategies discussed in this research may not be suitable for all investors. If you are in any doubt you should consult your investment advisor. <br \/>This report has been prepared solely for information purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any financial products. It should not be regarded as a substitute for the exercise of the recipient\u2019s own judgement.<br \/>No Intesa Sanpaolo S.p.A. or Banca IMI S.p.A. entities accept any liability whatsoever for any direct, consequential or indirect loss arising from any use of material contained in this report. <br \/>This document may only be reproduced or published together with the name of Intesa Sanpaolo S.p.A. and Banca IMI S.p.A.. Intesa Sanpaolo S.p.A. and Banca IMI S.p.A. have in place a Joint Conflicts Management Policy for managing effectively the conflicts of interest which might affect the impartiality of all investment research which is held out, or where it is reasonable for the user to rely on the research, as being an impartial assessment of the value or prospects of its subject matter. A copy of this Policy is available to the recipient of this research upon making a written request to the Compliance Officer, Intesa Sanpaolo S.p.A., 90 Queen Street, London EC4N 1SA.<br \/>Intesa Sanpaolo S.p.A. has formalised a set of principles and procedures for dealing with conflicts of interest (\u201cResearch Policy\u201d). The Research Policy is clearly explained in the relevant section of Banca IMI\u2019s web site (www.bancaimi.com).<br \/>Member companies of the Intesa Sanpaolo Group, or their directors and\/or representatives and\/or employees and\/or members of their households, may have a long or short position in any securities mentioned at any time, and may make a purchase and\/or sale, or offer to make a purchase and\/or sale, of any of the securities from time to time in the open market or otherwise. Intesa Sanpaolo S.p.A. issues and circulates research to Qualified Institutional Investors in the USA only through Banca IMI Securities Corp., 245 Park Avenue, 35th floor, 10167 New York, NY,USA, Tel: (1) 212 326 1230. Residents in Italy: This document is intended for distribution only to professional investors as defined in art.31, Consob Regulation no. 11522 of 1.07.1998 either as a printed document and\/or in electronic form. Person and residents in the UK: This document is not for distribution in the United Kingdom to persons who would be defined as private customers under rules of the FSA.<br \/>US persons: This document is intended for distribution in the United States only to Qualified Institutional Investors as defined in Rule 144a of the Securities Act of 1933. US Customers wishing to effect a transaction should do so only by contacting a representative at Banca IMI Securities Corp. in the US (see contact details above). <br \/><strong><br \/>Valuation Methodology<\/strong><br \/>Trading Ideas are based on the market\u2019s expectations, investors\u2019 positioning and technical, quantitative or qualitative aspects. They take into account the key macro and market events and to what extent they have already been discounted in yields and\/or market spreads. They are also based on events which are expected to affect the market trend in terms of yields and\/or spreads in the short-medium term. The Trading Ideas may refer to both cash and derivative instruments and indicate a precise target or yield range or a yield spread between different market curves or different maturities on the same curve. The relative valuations may be in terms of yield, asset swap spreads or benchmark spreads.<br \/><strong><br \/>Coverage Policy And Frequency Of Research Reports<\/strong><br \/>Intesa Sanpaolo S.p.A. trading ideas are made in both a very short time horizon (the current day or subsequent days) or in a horizon ranging from one week to three months, in conjunction with any exceptional event that affects the issuer\u2019s operations. In the case of a short note, we advise investors to refer to the most recent report published by Intesa Sanpaolo S.p.A\u2019s Research Department for a full analysis of valuation methodology, earnings assumptions and risks. Research is available on IMI\u2019s web site (www.bancaimi.com) or by contacting your sales representative.<\/p>\n<p>Source: BONDWorld &#8211; Intesa Sanpaolo \u2013 Research Department<\/p>\n<p style=\"position: absolute; left: -10000px; top: 0px; width: 1px; height: 1px; overflow: hidden;\" id=\"_mcePaste\">Normal 0 14       MicrosoftInternetExplorer4<\/p>\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The ECB meeting helped the euro, but the \u201cother\u201d challenges now lie ahead: Spanish banks and Greece&#8230;.&#8230;<\/p>\n","protected":false},"author":2,"featured_media":3461,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"telegram_tosend":false,"telegram_tosend_message":"","telegram_tosend_target":0,"footnotes":"","_wpscp_schedule_draft_date":"","_wpscp_schedule_republish_date":"","_wpscppro_advance_schedule":false,"_wpscppro_advance_schedule_date":"","_wpscppro_dont_share_socialmedia":false,"_wpscppro_custom_social_share_image":0,"_facebook_share_type":"","_twitter_share_type":"","_linkedin_share_type":"","_pinterest_share_type":"","_linkedin_share_type_page":"","_instagram_share_type":"","_medium_share_type":"","_threads_share_type":"","_google_business_share_type":"","_selected_social_profile":[],"_wpsp_enable_custom_social_template":false,"_wpsp_social_scheduling":{"enabled":false,"datetime":null,"platforms":[],"status":"template_only","dateOption":"today","timeOption":"now","customDays":"","customHours":"","customDate":"","customTime":"","schedulingType":"absolute"},"_wpsp_active_default_template":true},"categories":[22],"tags":[],"class_list":["post-1040","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-makrooekonomische-daten"],"blocksy_meta":{"styles_descriptor":{"styles":{"desktop":"","tablet":"","mobile":""},"google_fonts":[],"version":6}},"_links":{"self":[{"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/posts\/1040","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/comments?post=1040"}],"version-history":[{"count":0,"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/posts\/1040\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/media\/3461"}],"wp:attachment":[{"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/media?parent=1040"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/categories?post=1040"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmentworld.eu\/ch\/wp-json\/wp\/v2\/tags?post=1040"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}