Forex - Dollar at 1-week highs against yen, Fed ahead

The dollar was at one-week highs against the yen on Wednesday, supported by Tuesday’s stronger than forecast U.S. inflation data, as investors awaited the outcome of the Federal Reserve’s latest policy meeting.USD/JPY edged up 0.11% to 102.26, from 102.13 late Tuesday.The pair was likely to find support at 101.80, Tuesday’s low and resistance at 102.60.

                

The dollar strengthened broadly after the Labor Department said Tuesday that U.S. consumer prices rose 0.4% from a month earlier, bringing the annual rate of inflation to 2.1%. It was the fastest monthly increase in inflation in more than a year, beating forecasts of 0.2%.

The uptick in inflation indicated that the economic recovery is deepening and boosted expectations for a more hawkish stance on interest rates from the Fed.

Investors were looking ahead to the bank’s post-policy meeting press conference with Chair Janet Yellen later Wednesday, as they awaited fresh indications on the timing of possible interest rate increases.

The Fed was expected to cut its asset purchase program by another $10 billion, but is not expected to raise borrowing costs until mid-2015.EUR/USD was little changed at 1.3544, holding above the four month trough of 1.3502 struck earlier this month.

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Dollar gains on U.S. manufacturing report, ECB expectations

The dollar traded higher against most major currencies on Monday as investors applauded an upbeat U.S. manufacturing gauge despite two revisions to the index that confused markets, while expectations for the European Central Bank to loosen policy also firmed the greenback.In U.S. trading on Monday, EUR/USD was down 0.27% at 1.3597.In the U.S., the Institute of Supply Management reported that its manufacturing purchasing managers' index for May ticked down to 53.2 from 54.9 a month earlier before correcting it two times, once to 56.0 and a second time to 55.4.

                         

While the corrections confused markets, the dollar remained higher, as any figure over 50 signifies expansion.Analysts were originally expecting a 55.5 reading, and expectations remained firm for the Federal Reserve to continue tapering its monthly bond-buying program, which weakens the dollar as a side effect.

Elsewhere, the single currency came under pressure on expectations that the European Central Bank will take steps to tackle low inflation rates that are threatening an already fragile recovery in the single currency bloc, including cuts to all interest rates.

Earlier Monday, official data showed that Germany's consumer price index accelerated at an annualized rate of 0.9% last month, down from 1.3% in April. Analysts had expected German consumer prices to rise by 1.1% in May.

Separately, Markit research group said that Spain's manufacturing PMI rose to 52.9 this month, from 52.7 in May, in line with expectations, while Italy's manufacturing PMI slipped to 53.2 in June from 54.0 a month earlier, missing expectations for a 53.7 reading.

The European Central Bank will decide on interest rates and monetary policy on Thursday.The dollar was up against the yen, with USD/JPY up 0.62% trading at 102.41 and up against the Swiss franc, with USD/CHF up 0.37% at 0.8986.The greenback was up against the pound, with GBP/USD down 0.06% at 1.6744.

http://www.investing.com/news/forex-news/dollar-gains-on-u.s.-manufacturing-report,-ecb-expectations-287483

Gold extends slump to hit 18-week low with U.S. economy in focus

Gold prices declined for the fifth consecutive session on Monday to hit an 18-week low, as investors continued to sell the precious metal amid a weak technical outlook.On the Comex division of the New York Mercantile Exchange, gold for August delivery fell to a session low of $1,241.20 a troy ounce, the weakest level since January 31, before trimming losses to last trade at $1,244.40 during European morning hours, down 0.13%, or $1.60.



Gold lost 0.88%, or $11.10 on Friday to end at $1,246.00. Prices were likely to find support at $1,237.50 an ounce, the low from January 30 and resistance at $1,260.60, the high from May 30.

Gold extended losses from last week as prices remained below key support levels, indicating bearish chart signals. Prices lost 3.53%, or $45.70 an ounce last week. For May, gold prices dropped 3.9%, the biggest monthly price decline since November.
The precious metal has been under heavy selling pressure recently as investors bet on strong economic growth in the U.S. during the second quarter.

While data released last week showed that the U.S. economy contracted 1% in the first quarter, market analysts expects second quarter growth to snap back with a 3.8% gain, as the economy shakes off the effects of a weather-related slowdown over the winter.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market and the need for stimulus from the Federal Reserve.

Also on the Comex, silver for July delivery inched up 0.43%, or 8.1 cents, to trade at $18.76 a troy ounce.Elsewhere in metals trading, copper for July delivery rallied 1.19%, or 3.7 cents, to trade at $3.161 a pound as investors cheered an upbeat report on China’s manufacturing sector.

http://www.investing.com/news/commodities-news/gold-extends-slump-to-hit-18-week-low-with-u.s.-economy-in-focus-287273

Forex - EUR/USD gains on soft U.S. sentiment, personal spending data

The euro rose against the dollar on Friday after U.S. consumer sentiment and personal spending reports disappointed markets a day after data revealed the U.S. economy contracted more than expected in the first quarter of the year.In U.S. trading, EUR/USD was up 0.24% at 1.3635, up from a session low of 1.3598 and off a high of 1.3650.

The pair was likely to find support at 1.3586, Thursday's low, and resistance at 1.3668, Tuesday's high.The revised Thomson Reuters/University of Michigan consumer sentiment index ticked up to 81.9 this month from 81.8 in April, missing market expectations for a reading of 82.5.

                   

While harsh winter weather dampened spirits, concerns wages will remain weak did more so."The May decline in consumer confidence was not due to the dismal state of the economy during the 1st quarter, which had the weakest pace of GDP growth in three years. Consumers thought the harsh winter weather was mainly responsible," the indicator's statement read.

Consumer sentiment would suffer more if the economy failed to rebound in the months ahead, though the survey revealed that consumers feel the economy will be strong enough to produce more jobs in the year ahead."The main concern expressed by consumers involved dismal prospects for wage growth. Tiny wage gains meant that nearly half of all households anticipated declines in inflation-adjusted incomes during the year ahead," the statement read.


Elsewhere, the Commerce Department reported that personal spending in the U.S. fell 0.1% last month, compared to expectations for a 0.2% rise, after a 1.0% increase in March, whose figure was revised from a previously estimated 0.9% gain. U.S. core personal consumption expenditures, which exclude food and energy, rose 0.2% in April, in line with expectations, after a 0.2% increase the previous month.

http://www.investing.com/news/forex-news/forex---eur-usd-gains-on-soft-u.s.-sentiment,-personal-spending-data-287154

Forex - AUD/USD rises after mixed Australian data

The Australian dollar rose against its U.S. counterpart on Thursday, after the release of mixed economic reports from Australia, although demand for the greenback remained supported by upbeat U.S. data published earlier in the week.



AUD/USD hit 0.9301 during late Asian trade, the pair's highest since May 20; the pair subsequently consolidated at 0.9287, climbing 0.57%.The pair was likely to find support at 0.9203, the low of May 2 and resistance at 0.9367, the high of May 19.

Industry data earlier showed that new home sales in Australia rose 2.9% in April, after a 0.2% uptick the previous month.A separate report showed that private capital expenditure in Australia dropped 4.2% in the first quarter, compared to expectations for a 1.4% decline. Private capital expenditure in the fourth quarter of 2013 was revised to a 4.5% drop from a previously estimated 5.2% fall.

Meanwhile, the greenback still remained supported after data on Tuesday showed that U.S. durable goods orders rose unexpectedly in April and another report showed that U.S. consumer confidence improved in line with forecasts this month.
The Aussie was also higher against the euro, with EUR/AUD retreating 0.53% to 1.4640.

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Gold prices ease in Asia with China, India eyed

Gold eased in Asia on Friday with demand prospects from China and India in focus.A pickup in Chinese manufacturing in May - though still below expansion territory - and a new government in India may bode well for demand from the world's top two gold importers.

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at $1,294.30, down 0.05%, after hitting an overnight session low of $1,290.20 and off a high of $1,303.90.



On Wednesday, the Federal Reserve released the minutes of its April policy meeting, which revealed the U.S. central bank plans to continue tapering its monthly bond-buying program and rely on other tools to normalize monetary policy, though actual rate hikes won't come after considerable period of time.

The Labor Department reported earlier that the number of individuals filing for initial jobless benefits last week increased by 28,000 to 326,000 from the previous week’s revised total of 298,000. Analysts had expected jobless claims to rise by 12,000 to 310,000, though markets shrugged off the data.

Geopolitical concerns elevated gold prices also, as fears persist the Ukraine crisis will escalate and drag the U.S. deeper into the conflict, which could hamper recovery.Skirmishes with pro-Russian separatists left 11 Ukrainian soldiers dead in Ukraine's eastern region of Donetsk.

Ukraine will hold presidential elections on Sunday, and concerns persist that Russia will meddle in the voting and aggravate the crisis.U.S. and European officials have already warned that Russia would face sector-related sanctions if Moscow disrupts the upcoming elections.

http://www.investing.com/news/commodities-news/gold-prices-ease-in-asia-with-china,-india-eyed-286023

U.S. grains mixed; wheat falls for 6th straight session - Sean Seshadri

U.S. wheat futures declined for the sixth consecutive session on Wednesday, as market players continued to liquidate long positions amid easing concerns over tightening global supplies.On the Chicago Mercantile Exchange, U.S. wheat for July delivery declined 0.57% or 4.08 cents to trade at $7.0513 a bushel, during U.S. morning hours. Prices of the grain dropped 0.8%, or 5.6 cents on Tuesday to settle at $7.0920 a bushel.



Wheat prices have been under pressure in recent sessions after the U.S. Department of Agriculture projected higher global supplies than analysts had expected last week.

The USDA said global wheat inventories will total 187.4 million metric tons in the 2014-15 season starting June 1, up 0.5% from 186.5 million in the current marketing year.

In the U.S., approximately 30% of the winter wheat crop was rated “good” to “excellent” as of last week, down from 31% in the preceding week. Winter-wheat crops in “very poor” to “poor” conditions rose to 42% from 38% in the preceding week.
Elsewhere on the CBOT, U.S. soybeans for July delivery shed 0.25%, or 3.77 cents to trade at $14.8063 a bushel. The July soybean contract rallied 1.25%, or 18.4 cents on Tuesday to settle at $14.8360 a bushel.

Soy traders looked ahead to a report from the National Oilseed Processors Association due Thursday to gauge the strength of crushing demand for U.S. supplies in April.Meanwhile, U.S. corn for July delivery advanced 0.32%, or 1.62 cents, to trade at $5.0363 a bushel. The July corn contract added 0.65%, or 3.2 cents on Tuesday to settle at $5.0260 a bushel.

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