Forex: Monday’s review
The euro weakened to almost a seven-month low against the dollar after European officials failed last week to offer a plan to halt the region’s debt crisis as Greece struggles to avoid default.
The dollar rose against all its major counterparts except the yen as Treasury two-year yields fell to a record before the Federal Reserve begins its two-day meeting tomorrow.
The yen rallied to within 0.5 percent of its record against the greenback on refuge demand before European Union and International Monetary Fund officials judge whether the Greek government is eligible for its next aid payment.
Yesterday, Barack Obama presented a plan for collecting additional taxes amounting to $ 1.5 trillion over the next 10 years. Obama proposes to reduce the federal deficit by about $ 3 trillion within a decade, that is, the additional tax revenues to provide half the estimated amount of abbreviations. In particular, president wants to increase the tax burden on millionaires and billionaires who pay relatively less tax than the middle class.
After the Obama's plan publication U.S. stock indexes began to rise and fall in the dollar as a result of lower demand for safe-heaven currencies.
EUR/USD: the pair showed low $1.3590, then retreated and closed session on $1.3690.
GBP/USD: in first half of day the pair hold $1.5685/95 area. Then showed low $1.5630. The Pair finished session $1.5690.
USD/JPY: yesterday the pair was under pressure and showed low at Y76.30.
Two events will dominate Tuesday's calendar; the ongoing Greek/Troika discussions and the first day of the 2-day FOMC meet.
However, the ZEW survey will also be much anticipated (09:00 GMT).
Canadian data at 1230GMT includes the release of the August Leading indicator and July Wholesale sales.
US data released at 1230GMT includes August housing starts and building permits. The pace of housing starts is expected to slow further to a 580,000 annual rate after falling in the previous month. Weak new home sales and the high inventory level of unsold existing homes continue to restrain new home building.
At 1300GMT, the IMF releases its World Economic Outlook, with revised economic forecasts, with many expecting a downgrade of GDP
The FOMC begins its two-day monetary policy meeting, a meeting expended from 1-day to 2, for the members to explore further
exceptional measures available to the Fed.