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FX Day Trading - 15 August 2011
Japanese economy better than expected in Q2
Euro overcomes hurtful rumours
US consumer confidence lower again
Somebody has paid £140 million for a house in Oxfordshire. It is quite a big house, with nearly 37 times as much living space as the average British home, on a plot 9,000 times bigger.
In terms of cost-effectiveness Park Place scores highly on garden size but poorly on floor space, being 604 times as expensive as the average UK residence. Rightmove's monthly house price index, calculated from estate agents' offers on its website, fell by another 2.1% in August to £231,543.
At that level it is still well ahead of the £163,981 average transaction price reported ten days ago by Halifax but the gap is narrowing slowly. If would-be sellers are not caving, they are at least taking baby steps towards reality.
That does not mean buyers are queuing up. Nor are they showing any interest in southern European government bonds. The only buyer there – and a reluctant one at that – is the European Central Bank.
Whilst the ECB is doing a splendid job of propping up Spanish and Italian bonds, it is a job the Bank believes should be done by the European Financial Stability Facility. Moreover, it is a job that many Eurolanders believe should not be done at all.
Researchers at Maurice de Hond and No Ties BV, an opinion pollster (with a permanent dress-down policy?), found 54% of Dutch people in favour of removing Greece and its peers from the Eurozone. Fully 60% said the Netherlands should stop lending money to other Eurozone countries.
Nevertheless, Friday was a fairly good day for the euro. An unexpected 0.7% monthly fall in Eurozone industrial production did it no damage and online spread betting investors were content to overlook earlier rumours about French banks and France's sovereign credit rating.
Fresh bad news was in short supply and the majority of market practitioners were more focused on the POE part of POETS day, than they were on the minutiae of exchange rates.
Apart from those Euroland industrial production numbers there was little to gee them up. US retail sales clocked a respectable 0.5% rise, with the growth spread evenly between motor vehicles and other merchandise.
The University of Michigan's consumer sentiment index came in at a provisional – and quite nasty – 54.9 but nobody seemed to notice.
FX spread betting investor sentiment will have been boosted by this morning's news that Japanese GDP shrunk by only 0.3% in the second quarter, less than half the expected drop.
There isn't much left in the pipeline though, just Swiss producer prices, the New York Fed's manufacturing index, US international capital flows and the permanently-dismal NAHB housing market index.
None of the above is theoretically bad for the sterling spread trading market but the early buzz is that the bears are out and about.
Currency Trading and Spread Betting carry a high level of risk to your capital and you can lose more than your initial investment, they may not be suitable for all investors. Ensure you only speculate with money that you can afford to lose and that you fully understand the risks involved and seek independent financial advice where necessary.
The above content does not constitute investment advice, it is provided purely for information purposes and is delivered as a personal view of the writer. Neither the contributing company (or writer) nor Online-Spread-Betting.com accepts any responsibility for any use that may be made of the content.
'Spread Betting: Euro Rises Despite Fall in Eurozone Industrial Production', Article by Moneycorp, last update: 15-Aug-11
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