Any market feelers for Retail Revenue?
Housing?
Auto Sales?
50K Employement final month? = ? USD Bear?
But DJ will 12,000. Will that bring some cash into US and therefore a strong USD demand from JPY, GBP, EUR...???
Any market feelers for Retail Revenue?
Housing?
Auto Sales?
50K Employement final month? = ? USD Bear?
But DJ will 12,000. Will that bring some cash into US and therefore a strong USD demand from JPY, GBP, EUR...???
That's why I, among others, admire you....you're constantly trying to find out and help people out in the exact same time....plus you're in the darkened....it's one at the W columnOriginally Posted by ;
However find a rest....it's great for the body and soul. Per the fortune cookie I received in the chinese buffet now (and taped into the bottom of my screen):
A focused mind is one of the Most Effective forces in the world
The remainder will do your mind good my man
Regardless of that this Retail Sales was a killer to people who went on the release: Its FRIDAY THE 13th!
Have a nice weekend to you all! Its time to GOOF OFF!
I moved brief for EURUSD last night (during the retail earnings news), got a clean 30 pips and the system automatically took the profit for me. No sorrow thought I supposed to get about 50-60 pips when I was around for the customer sentiment report(Its better to play safe than to shed all of the opportunity if the price bounce back). Anyhow, I went brief after putting a lot of things under account, seeing that USD maintained going strong even when the news , looking back at daily chart told me that USD will keep going strong and yes the oil news weekly and the truth it's Friday was taken into account. I was quite confident that I did not even put a stop reduction and concentrate all my commerce on that one currency, it sounds risky and dumb but experience told me I wouldn't be that wrong with this...
D) inflationOriginally Posted by ;
some indior which has price as a portion of the title has to do with one major thing. . .INFLATION. This goes for CPI anything-PI. Trigger PI stands for price index.
Inflation is what the currency market watches. Everything comes back to inflation finally, becaues that is what causes the fed to move interest rates. The fed says that price stability is their objective. They use interest rates to stabilize price (when prices are high, they raise rates) and interest rates are what account for most of a currency's value, especially the dollar. If rates are high in a country, everyone goes out and converts their cash so that they can invest in that nation, and this demand is what moves the value of the currency. And that, my friend, is that the circle of why import prices are significant
Some additional considerations on this issue of inflation and exchange rates:
- as Merlin says, if a nation has high inflation that this equates to greater rates and increased demand for a currency.
- inflation impacts exchange rates, but exchange rates also have an effect on inflation rates (that in turn affect exchange rates, which then... and on and on)
- if inflation spirals out of control, it risks destabilising the economy from all angles and this might be currency negative.
- This week saw signs of firmer economic activity in the US (and it greater moderately inflationary expectations), while across the pond in Europe, inflation data from France was a shocker, coming in at just 1.5%, indiing that the ECB might need to revise it low quote for headline inflation reduced (from 1.8%). Certainly, this bad for EUR/USD, right?
Woah, not so fast cowboy. Assume there are two countries (A and B), with equal rates of inflation (say a rate of zero to keep things easy ), and state the exchange rate is simply 1:1. Subsequently hypothesise that inflation in country B doubles. Now a can of Coke in country B costs twice as much as in country A. Clever exporters of Coke in nation A visit an opportunity and begin shipping loads of Coke over to country B, while smart importers in nation B see exactly the same opportunity and thankfully take on all these imports, understanding they can sell them at twice the price domestically. This action increases the requirement for country A's currency relative to country B's (country B's importer have to buy country A's coke and thus demand more of country A's currency. Meanwhile, nation A's exporters get country B's money and convert it back to their home currency). This Coke arbitrage proceeds until the exchange rates have moved to 1:2 offsetting the change in inflation. 2006's Coke arbitrage chance is no more. So what? Well, note that the exchange rate of the inflation country has depreciated in this case. Higher relative inflation is actually bad for a currency. This is the cornerstone of purchasing power parity (PPP). The first stage is directly opposed to by thisconclusion, or can the two be reconciled?
food for thought. . .to be washed down with a Coke!
Hi . . .sorry, like a dunce, I recognized the case with exporters and importers as seperate entitities. I should have only used the other or on.
'Why does B demand A's Currency in case a has been compensated in B's Currency?'
Importers in state B want to buy the inexpensive coke in the state A and sell it domestically to make a clear profit. They have to buy country A's currency to cover them to the Coke.
PS - This example would be exciting if it was Cocaine and not Coca Cola.