Aussie Struggles on the Forex Market

Australian dollar is struggling on the Forex market, especially against the US dollar. Concerns about what’s happening in Europe are affecting risk appetite, and sending Forex traders away from riskier assets like the Aussie and to low beta currencies like the US dollar and the Japanese yen.

Risk appetite is playing a big role in the Australian dollar’s performance today. Concerns that the Greece might actually leave the eurozone are increasing, and there are worries that Spain can’t handle its debt. This risk appetite is leading to losses by high beta currencies like the Australian dollar against low beta currencies like the US dollar and the Japanese yen. Australian dollar is, however, higher against the euro, since the euro is in such a bad state.

The Aussie’s case isn’t being helped by the situation with gold, either. Gold prices are falling right now, and the Australian dollar is a commodity currency that derives a significant amount of support from the precious metal. Aussie also gets help from China, since Australia is one of China’s major trading partners. However, China hasn’t been seeing such stellar growth recently. The result is that Aussie is having trouble finding support against some of its counterparts.

At 13:12 GMT AUD/USD is down to 0.0082 from the open at 1.0019. EUR/AUD is down to 1.2859 from the open at 1.2869. AUD/JPY is down to 79.59 from the open at 80.18.

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US Dollar Gains Against Euro in Forex Trading

US dollar is heading higher against the euro in Forex trading right now, gaining as concerns about Spain and Greece come into sharper focus. Greenback is also higher against the Canadian dollar and other commodity currencies as oil prices and gold prices drop. UK pound, though, is gaining against the US dollar, as is the Japanese yen.

US dollar is turning in a mixed performance today, gaining against the euro and many commodity currencies as Forex traders look for safe haven against the volatility brought on by troubles continuing in Greece and Spain. In Greece, difficulties about forming a government, and the future of the austerity measuresagreed to for the bailout, are causing uncertainty. In Spain, the financial sector continues to struggle, and doubts remain about Spain’s ability to repay its debts. All of this is weighing on risk appetite and the euro, as well as keeping commodities down and prompting the greenback to gain against the Canadian dollar and the Australian dollar

However, there are other currencies gaining against the dollar. Great Britain pound is showing some strength, and the Japanese yen is higher as risk appetite grows. Concerns are that a higher pound will hurt the British economy, while Japanese leaders fret about the economic impact of a higher yen.

At 12:30 GMT EUR/USD is down to 1.2856 from the open at 1.2901. GBP/USD is up to 1.6077 from the open at 1.6066. USD/JPY is lower at 79.8045, down from the open at 79.9900. USD/CAD is up to 1.0052 from the open at 1.0002. AUD/USD is down to 0.9974 from the open at 1.0014.

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Euro at 3-Month Low as Greece May Leave Eurozone

The euro fell today, reaching the lowest level in more than three months against the US dollar, as speculation that Greece may leave the eurozone drove away investors from the shared 17-nation currency.

Greece is still unable to form a coalition government after a week of talks and negotiating. Even if the a government would be formed, the country may still leave the currency union as the Hellenic Republic is reluctant to implement austerity measures that are very unpopular among Greeks. Experts say that in the long term an exit of Greece from the eurozone may benefit both the country and the euro, but in the short term an impact could be very negative.

EUR/USD fell from 1.2901 to 1.2866 as of 8:50 GMT today, while the intraday minimum of 1.2860 was the lowest since January 23. EUR/JPY was down from 103.17 to 103.04.

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Pound Gains, Threatens Economy of UK

The Great Britain pound rose today as the safe haven role of the currency helped it to profit from speculation that Greece may leave the eurozone. The strength of the sterling caused worries that it may hurt the UK economy.

The pound gains appeal as the Swiss franc loses it due to the euro-peg. Economists are worried, though, that a strong currency may harm efforts to bring the United Kingdom out of recession. Ian Stannard, the head of European currency strategy at Morgan Stanley, explained:

The U.K. economic backdrop may not be brilliant, but it’s enjoying a haven status because of the political uncertainty in the euro zone. The advantage of sterling over a traditional haven like the Swiss franc is that its asset market is more liquid. The downside is that the strength of the pound may backfire as it hurts exports.

GBP/USD rose from 1.6063 to 1.6072 and GBP/JPY went up from 128.49 to 128.70 as of 8:18 GMT today.

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GBP Falls vs. USD & JPY, Gains vs. EUR Over This Week

The Great Britain pound fell against the US dollar and the Japanese yen this week as growing concerns about the health of the UK economy reduced appeal of the currency. The sterling is still perceived as refuge from Europe’s crisis, therefore it gained versus the euro.

Britain’s economy has entered a recession, significantly hurting prospects for the sterling. The Bank of England refrained from expanding stimulus during its last policy meeting, but most economists agree that the country needs quantitative easing. The pound is supported by its status of a safe haven, but such role looks tenuous considering the economic condition of Britain. Anyway, the problems of Europe allowed added to Britain’s strength against commodity currencies of countries that depend on European demand for their exports.

The pound was drifting down against the greenback and the yen since the end of March and it extended this trend for this week. The euro rose on Friday, but that did not help the shared 17-nation currency to erase its losses versus the sterling. The Canadian dollar was more successful, ending the week almost flat after falling for six consecutive trading sessions.

GBP/USD slid from 1.6133 to 1.6070 and GBP/JPY fell from 128.78 to 128.43. EUR/GBP was down from 0.8062 to 0.8033, while during the week it has reached 0.7994 — the lowest since 2008. GBP/CAD climbed from 1.6067 to 1.6201, but retreated to 1.6076 by the weekend.

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Australian Dollar Falls as China Signals About Slowing Growth

The Australian dollar slipped, falling to the lowest level this year against its US peer, as negative macroeconomic data hurt prospects for Australia’s exports and general pessimistic sentiment on the Forex market reduced appeal of growth-related currencies.

The National Bureau of Statistics reported that China’s consumer price index fell from 3.6 percent in March to 3.4 percent in April, being in line with forecasts. Industrial production, on the other hand, frustrated forecasters, falling from 11.9 percent to 9.3 percent, while an increase to 12.1 percent was predicted. Other fundamental reports, including retail sales, were also worse than expected. China is the main trading partner of Australia, therefore its fundamentals have a great impact on the Aussie.

The FX market in general also was not supportive for the Australian currency as traders preferred to stick to safer investments. JPMorgan Chase & Co. announced a $2 billion loss, sparking fear among investors. The MSCI Asia Pacific Index of equities slid 1 percent and posted the second week of losses.

AUD/USD was down from 1.0075 to 1.0019 — the lowest rate since December 20. AUD/JPY dropped from 80.50 to 80.08. EUR/AUD went up from 1.2829 to 1.2887.

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Swiss Franc Weakens This Week, Reverses Downtrend by Weekend

The Swiss franc was down for the second week as prospects of peg of the currency to the euro significantly reduced appeal of the franc a safe asset.

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Franc’s Rally Fails on Euro-Peg Speculation

The uncertain economic situation on market creates great demand for safer currencies. Governments, worried by resulting appreciation, attempt to intervene to rein excessive appreciation of such currencies. Today, the Swiss franc was one of the currencies that felt pressure.

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Franc Falls for Second Day on Risk Sentiment

The Swiss franc weakened for the second trading session as the positive macroeconomic data from Europe boosted stocks and commodities, reducing investors’ need for safety of the franc.

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Franc Gains as Markets Return to Risk Aversion

The Swiss franc snapped its decline today as the speculation about potential slowdown of the global economic growth returned attractiveness to safe currencies.

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Franc Falls as Bernanke Improves Sentiment on Markets

Friday, August 26th, 2011 The Swiss franc slumped today after Federal Reserve Chairman Ben. S. Bernanke spoke today, improving sentiment on markets, while rumors abound that Switzerland’s policy makers are preparing another action to weaken the Swiss

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Franc Rallies as SNB Doesn’t Intervene

The Swiss franc gained today for the second day, snapping yesterday its three-day downfall versus the US dollar and the euro, as the Swiss National Bank hasn’t announced new measures to curb franc’s strength.

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Franc Jumps as US Payrolls Show Zero Growth

The Swiss franc climbed today against the US dollar, extending its rally for the third day, after the non-farm payrolls showed that US employers weren’t adding jobs last month.

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Record Drop of Franc After SNB Pegs Currency to Euro

The franc plunged today, posting the biggest decline against the euro in all times, after the Swiss National Bank decided to set limit of franc’s appreciation versus the euro.

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Franc Considered Overvalued Even Pegged to Euro

The Swiss franc fell today against most major currencies as Economy Minister Johann Schneider-Ammann said that the currency is “massively overvalued” even after the central bank pegged the franc to the euro. The franc advanced against the euro today.

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SNB Maintains Rates at Zero, Franc Strengthens

The Swiss franc rose today even after the Swiss National Bank left the benchmark interest rate at zero at pledged to maintain the peg of the nation’s currency to the euro.

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Swedish Krona Down on Eurozone Optimism

The Swedish krona fell for another day this Wednesday as optimism in the Eurozone and negative releases in the Nordic country declined attractiveness regionally for assets in Sweden.

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Krona at Two-Year Record on Outlook for Monetary Tightening

The Swedish krona rose today to the highest level in two years versus the US dollar on the speculation that the central bank would perform its monetary tightening plans and as the economic data was favorable.

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Retail Sales Bolsters Swedish Krona & Bets on Rates Hike

The Swedish krona gained today after the report showed the retail sales grew more than predicted, increasing the probability of the interest rates hike.

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Swedish Krona Reaches 10-Year High vs. Euro

The Swedish krona rose for the second day versus the US dollar and reached the highest level in 10 years against the euro on the speculation that the strong global economic growth will increase demand for Sweden’s assets.

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