Canadian Dollar Continues to Surge Ahead in Currency TradingLoonie advances in forex tradingThe Canadian dollar continues to surge ahead in currency trading on the FX market. Jobs data shows that the Canadian economy is expanding, and commodities continue to support the loonie in forex trading. Bloomberg reports on the Canadian dollar on the FX market:``It's very difficult to call a top for the Canadian dollar,'' said Shaun Osborne, chief currency strategist at TD Securities in Toronto. ``The job number is incredibly strong. I'm somewhat surprised.''Loonie in Forex TradingCurrency trading on the FX markethttp://forex.gftforex.com/public/click/~Foreign%20Exchange%20Rates/www.gftforex.com/land/index.asp%3Faid%3D446Topic Tags: Canadian dollar currency trading, Canadian dollar FX market, currency trading, forex trading, FX market, jobs data Canadian economy, loonie forex tradingby mmarquitAustralian Dollar Gains in Forex TradingAussie moves ahead in currency tradingYesterday's Fed rate cut prompted a move forward by the Australian dollar in forex trading on the currency market. The Aussie is moving out of its tight range in currency trading, and breaking out. The Sydney Morning Herald reports on the Australian dollar in forex trading:The Australian dollar punched above 93 US cents on Thursday after an interest rate cut by the United States Federal Reserve made Australia's wide interest rate differential with that country look even more attractive.Aussie Currency TradingForex trading on the currency markethttp://forex.gftforex.com/public/click/~Foreign%20Exchange%20Rates/www.gftforex.com/land/index.asp%3Faid%3D446Topic Tags: Aussie currency trading, Australian dollar, Australian dollar forex trading, currency market, currency trading, Fed rate cut, forex tradingby mmarquitU.K. Pound Surges to Record High on FX MarketSterling moving forward in currency tradingThe sterling is moving ahead, touching new highs earlier, in currency trading on the FX market. The U.K. pound is gaining in forex trading, mostly due to dollar weakness and interest rate differential. Bloomberg reports on the success of the U.K. pound on the FX market:``Sterling has continued to be well-supported by ongoing pressures on the dollar,'' said Jeremy Stretch, a senior currency strategist at Rabobank Groep in London. ``The market has scaled back more exaggerated hopes of rate cuts from the Bank of England.''U.K. Pound Forex TraingCurrency trading on the FX markethttp://forex.gftforex.com/public/click/~Foreign%20Exchange%20Rates/www.gftforex.com/land/index.asp%3Faid%3D446Topic Tags: currency trading, dollar weakness, forex trading, FX market, interest rate differential, sterling currency trading, U.K. pound forex trading, U.K. pound FX marketby mmarquitEuro Drops on FX MarketEuro falls in currency trading"According to technical indicators, the euro made too many gains against the U.S. dollar this month."— Forex AnalystThe euro is down this morning in forex trading as the market moves toward a correction on the 13 nation currency's rally. Additionally, concerns over lower bank earnings in Europe are weighing the euro in currency trading on the FX market. Bloomberg reports on the euro in forex trading:``It's quite natural to expect some sort of a correction after we had a relatively uninterrupted rally in the euro,'' said Chris Turner, head of currency research at ING Financial Markets in London. ``I don't think it's as compelling trying to buy euro at the $1.44 handle than it was at $1.40.''Euro in Forex TradingCurrency trading on the FX markethttp://forex.gftforex.com/public/click/~Foreign%20Exchange%20Rates/www.gftforex.com/land/index.asp%3Faid%3D446Topic Tags: 13 nation currency, currency trading, currency trading FX market, euro currency trading, euro forex trading, euro FX market, forex trading, FX marketby mmarquitU.K. Pound Moves Ahead in Forex TradingCurrency trading with the sterlingThe U.K. pound is up in forex trading, making gains against both the Japanese yen and the U.S. dollar. Currency trading with the sterling should consider that its higher yield makes it attractive for the yen carry trade, and also that the likelihood that BOE rates will remain the same gives the currency an edge over the U.S. dollar. Bloomberg reports on the strength of the U.K. pound in forex trading:The pound stayed higher even after the Bank of England said mortgage lenders approved the fewest loans for home purchases in 26 months in September, adding to evidence the property market is cooling.

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Dollar regains some ground in Sydney afternoon trade after FOMC meeting
GFT in the media
Forex - Dollar regains some ground in Sydney afternoon trade after FOMC meeting03.21.07, 11:38 PM ET
SYDNEY (XFN-ASIA) - The US dollar was slightly higher against the yen and euro in midafternoon trade as market players continued to digest the statement from the US Federal Open Market Committee meeting which concluded overnight, dealers said.
At 2.08 pm (0308 GMT) here, the dollar was at 117.51 yen, up from 117.42 in morning trade while the euro eased to 1.3386 usd from 1.3389 earlier.
Dealers said although the Federal Reserve kept its target funds rate unchanged at 5.25 pct as widely expected, the altered wording in its outlook statement will give the market food for thought going forward.
The FOMC statement scrapped past language about the potential for further rate hikes ahead and firmer economic growth, but at the same time it again voiced concern about possible upside risks to inflation.
'Policy concern remains the risk that inflation will fail to moderate as expected,' the statement noted.
GFT analyst Ian Copsey said while the first impression from the statement appears to be US dollar bearish, it would be wise to take a cautious approach to the currency.
On the dollar/yen currency pair, he said the depth of recovery from Tuesday's 116.91 yen lows was exceptionally deep but until the 118.01-118.20 usd level is broken the bias still seems to be on the downside for the greenback.
Dealers said the next focus for the market will be tonight's speeches by Federal Reserve officials, as well as the US leading index for February.
Sydney 2.08 pm (0308 GMT) vs Sydney 9.59 am (2259 GMT Wednesday)
US dollar
117.51 yen vs 117.42 yen
1.2097 sfr vs 1.2091 sfr
Euro
1.3386 usd vs 1.3389 usd
157.25 yen vs 157.19 yen
1.6193 sfr vs 1.6187 sfr
0.6802 stg vs 0.6805 stg
Sterling
1.9630 usd vs 1.9631 usd
231.21 yen vs 231.04 yen
2.3805 sfr vs 2.3795 sfr
Australian dollar
0.8064 usd vs 0.8088 usd
0.4098 stg vs 0.4109 stg
94.745 yen vs 94.940 yen
New Zealand dollar
0.7087 usd vs 0.7107 usd

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Topic Tags: dollar, Federal Reserve, FOMC, GFT media, Sydney
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March 22, 2007

Find our Forex Lens on Squidoo.com
View blog highlights, access Amazon forex books and more
GFT Forex can be viewed through the forex trading Lens on Squidoo.com. You can view blog headlines, which are updated daily, and link to Amazon.com. From this Lens, you can also fill out your information and open a Demo Account. Click here to go to Squidoo, or type www.squidoo.com/GFTforex into your browser.
Topic Tags: forex books, forex information, GFT, Lens, links, Squidoo
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February 09, 2007

Yen battles yuan for G7 spotlight
Low rates, carry trade push yen to multi-year lows, but will G7 agree to care?
NEW YORK (MarketWatch) -- The Chinese yuan now has a bit more competition in the contest for the most undervalued currency.
The weakness in the Japanese yen is dominating the market's attention as financial leaders from the Group of Seven leading industrial nations prepare to meet in Essen, Germany, this weekend. European officials, worried about the impact of a rising euro on the eurozone's economy, have complained that a weak yen gives Japan an unfair trading edge. What the G7 meeting is really about -- Gucci handbags
But will anybody listen to their complaints?
The yen slumped to a four-year low against the dollar, an all-time low against the euro, a 14-year low against the British pound, and nine-year lows against the Australian dollar, New Zealand dollar and the Swiss franc earlier this year.
Japan's currency has been especially weak versus the euro in recent years, losing about 50% of its value since the end of 2000.
Not only is the yen weak in nominal exchange rates, but deflationary pressures in Japan over the past years have made the currency even more competitive in real terms. The latest data from the Bank of Japan showed that in January, on a real trade-weighted basis, the yen fell to its lowest level since 1985, the year the G7 signed the Plaza Accord and caused the yen to appreciate -- a move that ultimately dragged the Japanese economy into a decade-long economic slump. Read Bank of Japan statistics.
The Economist's Big Mac index showed that the yen was the most undervalued of all developed countries currencies -- meaning that burgers are cheapest in Japan. The index, built on the theory of purchasing-power parity, measures how much currencies should adjust to equalize the price of a McDonald's Big Mac in different countries. The yen was 28% undervalued against the dollar at the end of January, according to the index. Read the Big Mac index.
In fact, the yen has also devalued hugely against the yuan in recent years, leading some analysts to suggest the yen is now cheaper than the yuan, which is also known as the renminbi. Stephen Jen, a currency analyst at Morgan Stanley, argues that by some measures, the yen is now 16% undervalued against the dollar, while the yuan is only 4.7% mispriced.
"The yen is possibly three times more mispriced than the Chinese yuan is," Jen said. "Relative to the yuan, the yen is much more mispriced."
Weighing heavily on the yen: Japan's key short-term interest rate, currently at 0.25%, is the lowest among all major economies. With the country still scarred by the memories of decade-long deflation, Japanese monetary authorities continue to err on the side of caution.
The notorious "carry trade" is another big factor behind the yen's slump. The yen has been widely used as a funding currency -- in which speculators make profits by borrowing (selling) the yen at low costs and reinvesting in higher-yielding currencies and assets, such as the New Zealand dollar, the British pound, and the Icelandic krona. "Be reminded that every time the Japanese economy has been looking at a recovery over the past 15 years it has failed because of low domestic demand. There are good reasons why the interest rate is low," said Ian Copsey, senior financial analyst at Global Forex Trading.

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Topic Tags: forex, g7, GFT media