Browse by Tags

Daily Pfennig

Blog Subscription Form

  • Email Notifications
    Go

Archives

  • Risk Off as US data disappoints…

    In This Issue..

    * Risk is back off on poor US data...
    * Euro pauses at $1.32...
    * China moves by Japan to become #2...
    * Gold moves close to $1,200...

    Good day...and welcome to Wednesday, or as we call it on the desk 'hump day'. Yesterday was another busy day on the desk, it seems like investors are finally figuring out that in spite of the uncertainty in the markets, there are still some good opportunities. But while the flow of trades increased yesterday, the currency markets took a breather from their torrid pace on Monday.

    What movement did occur yesterday was mainly due to a plethora of data releases in the US which mostly disappointed. Personal income and spending in the US were both reported unchanged for the month of June, and May's numbers were revised slightly lower. And while US consumers were feeling the pinch, prices rose a bit more than expected with the PCE Deflator moving 1.4% higher vs. an expected 1.3% increase. So it was no surprise when the ABC Consumer Confidence number came in at -50, again worse than what was expected....
  • More Strong Data Sinks The Dollar...

    In This Issue..

    * Currencies near 1-year levels...
    * Canadian loonies are best performer!
    * Dangling a carrot...
    * Oil trades above $72...

    Good day... And a Tub Thumpin' Thursday to you! Why Tub Thumpin'? Why not? Besides, the non-dollar currencies are darn near where they were a year ago, having a good chunk of the ground they lost during the Financial Meltdown last fall and winter... Not that I'm a cheerleader, but more of a 'this is what I believed would happen, and glad to see a plan come together' kind of guy!

    And since I, unlike throngs of people that like to point out errors, put my beliefs in writing every day... Right out there / here, in the open, for anyone to take pot shots at... But, I learned long ago that there will always be those that disagree, and not to let it upset or change the things I believe...

    ...
  • Dollar continues it’s slide...

    In This Issue..

    * Dollar continues to slide...
    * US GDP contracts but not as fast...
    * Nordic currencies outperform...
    * Japanese yen continues to fall...

    Good day... The last day of July is upon us. Time just seems to keep moving faster as it seems summer just got started. The fall of the dollar also accelerated yesterday as investors moved back out of the 'safe haven' of US$ and continued to shop for more yield. The greenback tried to stage a bit of a rally in early European trading, but has fallen back off again as I sit down to write the Pfennig.

    I got a call from a Reuters reporter yesterday mid morning to ask why the dollar was rallying at the same time stocks were moving higher. I quickly paged through my Bloomberg looking for some sign why both were heading higher. The trading pattern which has been established over the last few months has these two asset classes moving in opposite directions; good news for the US economy sends stocks higher and the dollar lower as investors retreat from defensive 'safe haven' positions in the US$. The opposite occurs whenever there is data which shows the global economic recovery is faltering, stocks move lower and the dollar rallies with safe haven buying....
  • A shrinking US economy puts pressure on the US$...

    In This Issue..

    * US GDP falls more than expected...
    * FOMC holds course...
    * Canadian dollar has a great week...
    * Oil helps commodity currencies...

    Good day... Yesterday was a big day in St. Louis as President Obama came to visit on his 100th day in office. I can't believe it has been 100 days since the inauguration. Time sure does fly! I'm sure Obama and the rest of his administration would like the calendar to move even faster as this recession will likely last through the end of 2009. While the government has thrown trillions of dollars at the markets in an attempt to turn them around, the key ingredient for recessionary cycles to reverse is time. There is now 'quick fix' for the problems we are in, and the policies the administration has begun will take time to have an impact on our shrinking economy. Obama said as much in his nationally televised press conference last night....
  • Awful Data!

    In This Issue..

    * Weber opens Pandora's Box...
    * A record low for Capacity Utilization!
    * Do I hear a Chicken?
    * China's economy grows 6.1%

    Good day... And a Thunderin' Thursday to you! The 'Day After' Tax Day... It still hurts! And to think, one of these days, I'll be paying even more, thanks to the direction of our country... And you will be too! There's no two ways about it, the Deficit in funding in Washington D.C. which will be a result of all the spending, is going to require greater revenue... Where does the Gov't get the revenue? From taxes... Of course if it wasn't a debtor nation, it would not have to pay out the large sums of interest on the Treasuries it issues... But, that... Is a discussion for another day.

    The currencies saw more dollar strength yesterday, but it wasn't a result of anything the dollar had going for it... In fact, the results of the data yesterday was all dollar negative... No, this time it came from the Eurozone. Right about the time I was hitting the send button yesterday, European Central Bank (ECB) minister, Axel Weber Opened Pandora's Box of questions regarding future direction of the ECB... Let's go to the tape!...
  • Wild Swings!

    * Euro gains, then loses, then gains... * Inflation and Commodities... * The euro turns 10! * Risk Aversion remains but is waning... ** Wild Swings! Good day... And a Terrific Tuesday to you! Well, it happened way too late for yours truly to witness it, but my beloved Missouri Tigers rallied and won the Alamo Bowl in overtime. Go Tigers! Hopefully they can fix the defense before next fall! OK... Remember those Wild Swings I talked about yesterday? The Wild Swings that could be a result of thin volumes in this the second week of Christmas. Well... We witnessed them in earnest yesterday! As I signed off yesterday, I told you that the euro had rallied 2 whole figures to 1.43 and change. Well, that rally dissipated throughout the morning, and by late in the day the single unit was 1.39 and change... WOW! Now that's a Wild Swing! You can point to profit taking as the reason for the move, and with the volumes thinned out by Holiday trading, one profit taking sell begot another, and before you knew it, the euro was looking at a loss on the day....