Intraday Market Thoughts

Gold Nears $1870, Euro Fails to Gain from German PPI,

by Patrik Urban
Aug 19, 2011 12:45

Dow & S&P500 futures both down by 1.3%. Gold is less than $150 away from $2000. German July PPI increased to 0.7% from previous 0.1%. On a yearly basis, PPI jumped to 5.8% while analysts expected a rise of only 5.3%. Canada CPI in line with expectations.

UK Public finances improved in July as the budget recorded a surplus of GBP 2B instead of an expected deficit of GBP 0.4 B. New bank tax and a progress in local governments finances contributed to better fiscal position. However, analysts note that this improvement is not enough to hit fiscal forecasts for the year. GBP has been strong despite weak data over the past few days so positive print should provide additional support for longer term players.

Canadian CPI came out in line with expectation at 0.2% after dropping by -0.7% in June. Core CPI also jumped back above the zero level and printed 0.2% as well. The CAD has been under pressure as both Brent oil and WTI have been selling off rather dramatically over the past two days. Slowing growth and low inflation means that it could take some time before rates are hiked. Next BOC rate decision is scheduled for September 7th.

The New York session will not bring any fundamental data releases today so trading will be determined by overall sentiment, capital flows and technicals. Traders should note that at 8:30 am ET FOMC Member William Dudley speaks about economic conditions at the Meadowlands Commission in Lyndhurst. Q&A session will follow his speech and given how dovish his comments usually are, the greenback could sell off.

Thursday's Premium shorts in S&P500 hit all targets, while silver positions are partly executed. Other trades include EURUSD, EURJPY, EURGBP, GBPUSD, GBPJPY, S&P500, silver, US crude To get a trial a click here:


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