Central Banks Coverage

Moody's downgrades Greece below junk, Euro shrugs it off
Moody's cut Greece's government-bond rating on Monday, slashing the country's rating four levels to Ba1, officially on notch into junk status. Markets reeled on the news, US Treasury prices pared losses and Asian stocks fell for the first time in four days. Japan's 5-year treasury notes rose for the 2nd day and gold rose on the flight to safety. The Euro largely shrugged off the release, as Moody's intent to downgrade was known long in advance and an Industrial Production data release in the

Europe reacts to the global crisis
European countries are planning to take their first specific joint actions in order to protect the small private investor from the financial crisis. The finance ministers of the Euro Zone reached an agreement, which still must be approved by the EU27, to raise the maximum bank deposits guarantee to 40,000 euros. According to the Commissioner of Economic and Monetary Affairs, Joaquin Almunia, if the proposal receives this support, the European Commission will work on another initiative to raise

Will there be a European Bailout plan?
Germany and Ireland are for the moment the first two European countries that adopted emergency measures in order to ease the effect of the widening international credit crisis in the Euro Zone. German Chancellor Angela Merkel is moving fast in order to avoid the worst consequences of the financial turmoil hitting German private banking and she has assured her determination to guarantee bank deposits. After a meeting of the prime minister's of the largest European economies -UK, Italy, France

The US House approves the Financial Bailout plan
The US House has approved Bush’s $ 700 Billion Bailout Plan to save the US financial market in the second attempt after some modifications, including tax cuts, were introduced to it, in a improvised reaction to revive it after it was rejected on Monday. The plan has been approved by 263 votes to 171, with Democrat representatives voting massively for it while iin the republican side the “Nay” won over the “Yea” by a narrow margin. The Plan, mainly consisting in a $700 billion bailout to buy

The Bailout Plan: 2 rounds done, one to go
The US House has approved Bush’s $ 700 Billion Bailout Plan to save the US financial market in the second attempt after some modifications, including tax cuts, were introduced to it, in a improvised reaction to revive it after it was rejected on Monday. The plan has been approved by 263 votes to 171, with Democrat representatives voting massively for it while iin the republican side the “Nay” won over the “Yea” by a narrow margin. The Plan, mainly consisting in a $700 billion bailout to buy

The Bailout Plan: The Senate approves the bill
Finally, the US Senate has approved the Bailout Plan on a 74 against 25 vote. This Friday the House of Representatives will vote the bill, a revised version of the measure that failed Monday. Those changes include a raise in federal deposit insurance to $250,000 from $100,000, a change proposed by the Republicans. It will also include the Senate version of an extension to a series of renewable energy and other business tax credits as well as extension of a fix for the alternative minimum tax.

Banks interventions: Trying to settle down global uncertainty
Desperate cases call for desperate measures and we are living the most uncertain times ever seen in the global economy. On FXstreet.com we have prepared a special overview of the crisis to help you know what's going on over the world. Summary Central Banks' injection of money State interventions in private banks Stocks and the crisis What do the Governments think? Central Banks' injection of money The biggest central banks are tightening their efforts to bring back to life the stalled global

Financial Crisis - Bush: "Congress must act on decisive action"
The House of Representatives has rejected the Bailout Plan with more than two thirds of Republican congressmen voting against it. Numbers say that 205 representatives agreed, while 228 were against it. US president, George W. Bush, said that he is "very disappointed" by the outcome of this plan designed by his own administration. After that president Bush has called for an urgent action in order to avoid a "painful and lasting" economic damage, "For the financial security of every American,

Financial Crisis: Bailout Plan stopped for now
The House of Representatives has rejected the Bailout Plan with more than two thirds of Republican congressmen voting against it. Numbers say that 205 representatives agreed, while 228 were against it. The US president, George W. Bush, said that he is "very disappointed" by the outcome of this plan designed by his own administration. After two weeks of hard negotiations, the program seemed to have acquired a consensus shape between Republicans and Democrats. After the result, the White House

Financial Crisis: The Bailout Plan is almost there
Congressional leaders have finally agreed on a draft that will allow the US Treasury to buy up to $700 billion of troubled debt securities from the banks. Still, the Bailout Plan has yet to be approved by the Congress and by US President George W. Bush. There is still a lack of clarity with respect to what the government will pay to acquire the toxic assets, but the Treasury will release more details within 45 days. The last banks to have suffered the effects of the crisis have been Bradford

Financial Crisis: Bush to lawmakers: "Move quickly"
With the Bailout plan on standstill, President Bush has called to lawmakers to move quickly  in order to approve the TARP, "something substantial must be done..." urged the President. "Our proposal is a big proposal and the reason it's big and substantial is because we've got a big problem," Bush said. The original plan consisted in a proposal by the Federal Government to buy up to $700 billion of illiquid mortgage backed securities (known as toxic assets), in order to increase the

Financial Crisis: Will the Bailout Plan save US economy?
The Bailout Plan proposed by the US Government in order to refloat the US economy was about to fail, finding itself in the crossroads of the interests of the White House, the Congress and the two presidentials, John McCain and Barack Obama. The original plan consisted in a proposal by the Federal Government to buy up to $700 billion of illiquid mortgage backed securities (known as toxic assets), in order to increase the liquidity of the secondary mortgage markets and reduce potential losses

Bernanke's and Paulson's testimonies
Going on with all the crisis ambient that has reigned over the markets on the last weeks, two of today's most important events were US Treasury Secretary's Henry M. Paulson, and Fed's Chairman Ben Bernanke testimonies before Sennate Committee. They spoke about the latest developments on the credit crisis and the state of the U.S. financial markets. It indicates a sign of new fiscal policy. Both of them have followed a very similar discourse. On one hand Paulson said that "over these past days,

Financial Crisis: The US Government's ultimate intervention
The highlight of this past week has been the revelation of the real magnitude of the current financial crisis, manifested by the dimensions of the actors we have seen entering the scenario during the past ten days, which have pressured the higher U.S economic and political institutions to put out the largest intervention since the year 30’s. At the minute, the US official are working on a plan to rescue US banks to get rid of their debts in order to recover from the global financial crunch.

Central Banks move its forces to beat the global (US) problem
"Today, the Bank of Canada, the Bank of England, the European Central Bank (ECB), the Federal Reserve, the Bank of Japan, and the Swiss National Bank are announcing coordinated measures designed to address the continued elevated pressures in U.S. dollar short-term funding markets. These measures, together with other actions taken in the last few days by individual central banks, are designed to improve the liquidity conditions in global financial markets. The central banks continue to work

US Financial Crisis goes on: AIG makes Fed reverse its position
The US government has changed its no-more-money's position in order to support American International Group, AIG , the American biggest insurer by assets. The Fed concluded, in its yesterday's Statement, that a disorderly failure of AIG could make the financial market even more fragile.  Six hours after the FOMC decision of leaving rates unchanged, the Fed used the section 13(3) of the Federal Reserve Act to save AIG under severe conditions.    The Fed, supported by the

US Crisis: The Fed calls for stability
Although central banks gave more than 230 billion dollars as injections to stimulate liquidity into the financial market between yesterday and today, the  turmoil has accelerated falling stock prices, high bond prices and appreciation of the JPY. After the black monday, we have seen oil prices below $100, near to the $89 range, Moscow stocks lost 11% today, also London stock looses near of 3.5% and Nikkei fell 4.95%. Almost all of investors have shown a scramble to enforce a risk aversion

US Crisis rebounds: Merryll Lynch and Lehman Brothers enter the fray
Last weekend the US damaged economy had to deal with a new severe blow. Merryll Lynch was sold to the Bank of America for $29 a share at a value of $50 billion. Meanwhile, Lehman Brother s faces the bankruptcy after failing in its attempt to find potential buyers. The Federal Reserve board announced on Sunday several initiatives to provide additional support to financial markets, including enhancements to its existing liquidity facilities. It is the worst economic slump in postwar history. The

US Dollar hits one-year high vs euro
During the last hours we have seen the EUR/USD reaching its lowest level since September 2007. The pair touched a new one-year low with the pair losing more than 900 pips in less than two weeks. Along today’s European and US sessions most of our experts and contributors wanted to give their own analysis of this situation. Kathy Lien, Director of Currency Research at GFT (Global Forex Trading), wrote a special report about this topic where she said: “3 primary factors continue to drive the Euro

US Treasuries take over Freddie Mac and Fannie Mae
The U.S. Government finally decided to take over the 2 mortgage giants Fannie Mae and Freddie Mac. Details were announced over the weekend by the US Treasury: $200 Billion in new capital plus credit lines would be made available. The more shocking news were that the two companies would be put under management of the Federal Housing Finance Agency. This injection has brought liquidity to the markets. So far U.S. bond yields and Asian Markets have shown a good recovery. The US government stands

Fannie Mae and Freddie Mac situation
First of all, let's see who are these two guys that are creating all this buzz in the markets lately: The Federal National Mortgage Association (FNMA), commonly known as Fannie Mae , is a government sponsored enterprise (GSE) of the United States federal government. It is a shareholder-owned corporation authorized to make loans and loan guarantees. The Federal Home Loan Mortgage Corporation ("FHLMC"), commonly known as Freddie Mac , is also an US GSE. It is a stockholder-owned corporation

Central Banks money injection
Following last years' movement, the Fed has announced that it will inject $200B of Treasury securities under a new Term Securities Lending Facility (TSLF), by expanding its securities lending programme. The Fed will also increase the swap lines with the ECB and SNB. On one hand, the ECB agreement will increase to up to $30B and on the other hand, rised the Swiss accord to $6B. · Review the opinion of the experts at the Analysts or Authorities Comments and check the movements of the indices in

US Recession?
The financial markets have been caught by fears of a US recession and a worsening of the problems in the financial sector. We can take a look the most recent events that have led to this situation. On Thursday 17, Mr Bernanke asked for the help of the US Administration in his speech at the Senate. This movement was seen by many analysts as a sign of weakness, interpreting that the Fed cannot take control of the actual US economic state. But the strongest day was on Friday 18, when US

G7 Meeting Review
The joined statement itself did not add anything new to what we had read previously, only that the Europeans joined the US in their call to China to allow their currency to strengthen. So, after all taht was said and done, unfortunately, we did not have any mention to the current USD weakness (or EUR strength), other than that of the IMF Director Rodrigo Rato, stating that the 'USD is overvalued mid-term'. [ Read full Tony Juste's article ] · Review the opinion of our experts at the Analyst

G7 Meeting
This G7 meeting arises as one of the more interesting for the Forex Market, so it's the first time that it is officialy scheduled in the meeting's agenda. Though the main focus will be the Global credit crisis current Yen and Dollar weakness, as well as the Euro strength, will also be some of the more important topics to be covered. · Review the opinion of our experts at the Analyst Comments . In-Depth Analysis · Daily Forex Technical Report - Yen Strengthens on Risk Aversion ahead of G7 by

The Aussie remains at record highs with gold at multi-decade high, but… will it last?
The recent appreciation of the precious metal, reaching its higher prices in the last thirty years, has fuelled the Australian dollar rally to the higher levels against most major currencies where it remains at the moment, nevertheless voices start to warn about the possibility of a sharp decline on gold’s value. The Aussie is enjoying a particularly good momentum, a continuous appreciation that took it to a 18-year high against the U.S. Dollar, as a conclusion on a upper trend that started

Carry Trade Earthquake
In the last eight months, almost all of the trading activity has been guided by the movements of the carry traders, who have sent the JPY and the CHF to new record lows , while AUD, NZD, GBP and EUR have reached either new record or multi-decade highs. One of the most affected currencies by this rebound is the Yen that has seen an incredible surge of over 3,000 pips against the GBP, in a panic-related move generated by the carry traders unwinding their positions. Review the opinion of our

G7 Meeting Review
G7 Meeting After a "non-event" G7 meeting the Yen saw a negative influence that made it fall down to 162.40 against the Euro, to 238.25 against the Pound and to a119.65 against the Dollar. The meeting also missed the participation of two main countries such as Germany and China. Some of the most relevant declarations have been said by JC Trichet: "The fundamentals are very encouraging in Japan, and this will be reflected, should be reflected, in the markets." Review the opinion of our expert

G7 Meeting Review
G7 Meeting The G-7 meeting is over, and the joint communiqué did not talk especially on the Yen, in another very oblique statement. Carry Trades were the main subject on this meeting. The majors did not move much in light of the JPY action, but they gained momentum against the USD, as technical indicators pointed out on Friday. [Read full story] Review the opinion of our expert Tony Juste in the Advisor's Blog In-Depth Analysis US Open Market Points -  Yen Probes 122.00 After G-7

G7 Meeting
G7 Meeting This G7 meeting will have in the current Yen weakness one of the main topics to discuss, although initially was taken out of the agenda. German and some U.S. voices have insisted in put this topic in the list of debated issues at the meeting, as a means to reach an agreement and find some balance with Yen quotations. Review the opinion of our expert Tony Juste in the Advisor's Blog In-Depth Analysis G7: Best stay mum on the yen chaps by Danske Bank A/S Morning Report -  G7

Non-Farm payrolls Review
Non-Farm payrolls Review The January employment report has shown that the US economy created 111K new jobs in January. This reading is below the market consensus that previewed a number of 150K. However, the report also showed an important amount of positive revisions which counteract the negative numbers of January. Give your opinion in the FORUM POLL: Where do you think the market will go after NFP is released? You can also review all the historical data of the payrolls in our Economic Time

Non-Farm payrolls
Non-Farm payrolls Employment figures are expected to go in sync with the current bullish tone for US economy, with an estimate of around 150,000 new jobs being created. The last unemployment reports have keep up well and should have done so in January too. Register now to our Special Webinar: Trade Non-Farm payrolls LIVE with Wayne McDonell. Or give your opinion in the FORUM POLL: Where do you think the market will go after NFP is released? You can also review all the historical data of the

BoJ Tankan
BoJ Tankan The Japanese Tankan survey of business sentiment for larger manufacturers has seen improvement for the third consecutive quarter, reaching the level +25 from +24 in September. The reading matched the experts forecasts who advanced a reading of +21. Larger non-manufacturers reached the level +22 from +20 the previous quarter, mid size manufacturers have recorded +17 from +14 the previous quarter. Japan’s 4Q Tankan business index shows improvement, in line with expectations by

G7 Meeting
Here are the main points of the statement issued by the Group of Seven finance ministers and central bank governors after their meeting in Singapore. [ Full Story ] In-Depth Analysis US Trading Preview - Dollar Rallies after G7 by Forexnews.com US Open Market Points - Yen Seesaws Post G-7 But 118.00 Caps Weakness by FXCM Wakeup Call on Forex Markets - G7/IMF non-event so far by Saxo Bank Weekly Forex Research - G7: "Place your bets" by Jyske Bank Weekly Comment on Currencies - G7 meeting in