Indian Rupee closed at 49.29 as exporters sold dollars on expectations the rupee was going to rise further in the coming sessions. U.S. dollar remains under pressure as growing optimism continues to fuel demand for riskier assets which led to the S&P 500 erasing all of its losses for the year during trading yesterday. However, we could see a retracement today if traders look to book profits which could create greenback support. Yet, the ISM non-manufacturing report is expected to show an improvement to 42.0 from 40.8 as an increase in consumer confidence could have sparked greater demand. An improvement in the service sector gauge would build upon the positive manufacturing reading and boost the outlook for future growth. An improvement in hiring could lower expectations for the amount of job losses in the economy for April which will be revealed in Friday’s Non-farm payroll report. The Euro traded heavy after reaching as high as 1.3441 as traders started to hedge their bets ahead of the Producer price report. The inflation gauge showed that factory gate prices fell by 3.1% on a yearly basis which was the biggest drop in 22 years. A 7.3% drop in energy costs led the way but the 1.7% decline in the other components demonstrates that prices are being cuts across the board. However the dismal inflation report failed to extend the single currency losses as it has started to regain its footing since the release trading higher from its intra day low of 1.3321.Indeed European companies have been forces to slash prices as they try and lure in consumers that remain reluctant to open their wallets as the region’s recession continues to deepen. Although the ECB has maintained that it isn’t concerned about deflation as they expect price pressures to return by the end of the year. The pound reached as high as 1.5115 as it was boosted by April’s PMI construction reading rising to 38.1 . The reading shattered prediction s of 31.9 which could be assign that loosening credit markets are beginning to fuel demand for new construction as businesses and consumers are beginning to gain access needed funds. Sterling continues to benefit from the broader increasing optimism and with China and the U.S. showing green shoots if the U.K. data continues to follow suit then we could see the currency continue to receive support. Japaneses Yen remained within the range of 98.60-99.20 levels for the day.
Tuesday, May 5, 2009
Evening Report -May 05
Indian Rupee closed at 49.29 as exporters sold dollars on expectations the rupee was going to rise further in the coming sessions. U.S. dollar remains under pressure as growing optimism continues to fuel demand for riskier assets which led to the S&P 500 erasing all of its losses for the year during trading yesterday. However, we could see a retracement today if traders look to book profits which could create greenback support. Yet, the ISM non-manufacturing report is expected to show an improvement to 42.0 from 40.8 as an increase in consumer confidence could have sparked greater demand. An improvement in the service sector gauge would build upon the positive manufacturing reading and boost the outlook for future growth. An improvement in hiring could lower expectations for the amount of job losses in the economy for April which will be revealed in Friday’s Non-farm payroll report. The Euro traded heavy after reaching as high as 1.3441 as traders started to hedge their bets ahead of the Producer price report. The inflation gauge showed that factory gate prices fell by 3.1% on a yearly basis which was the biggest drop in 22 years. A 7.3% drop in energy costs led the way but the 1.7% decline in the other components demonstrates that prices are being cuts across the board. However the dismal inflation report failed to extend the single currency losses as it has started to regain its footing since the release trading higher from its intra day low of 1.3321.Indeed European companies have been forces to slash prices as they try and lure in consumers that remain reluctant to open their wallets as the region’s recession continues to deepen. Although the ECB has maintained that it isn’t concerned about deflation as they expect price pressures to return by the end of the year. The pound reached as high as 1.5115 as it was boosted by April’s PMI construction reading rising to 38.1 . The reading shattered prediction s of 31.9 which could be assign that loosening credit markets are beginning to fuel demand for new construction as businesses and consumers are beginning to gain access needed funds. Sterling continues to benefit from the broader increasing optimism and with China and the U.S. showing green shoots if the U.K. data continues to follow suit then we could see the currency continue to receive support. Japaneses Yen remained within the range of 98.60-99.20 levels for the day.
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