Forex Market News
Putin is still trying to hide but it is clear now that Russia is at war with Ukraine, if not officially. Safe haven bid is back on a bit, because of the lack of resolution in the Putin/Poroshenko talks this week. This could escalate nastily and whilst Poroshenko is calling on NATO’s help he won’t get much from Obama the toothless panther. Not that I think the US should get involved, the UN is designed for these conflicts, but it and it’s Security Council are all too ineffective. So when you have a little man being bullied and beaten by a larger man, who will stand up for the little guy? NATO is the answer, but they won’t move without US backing, so it is a bit of a mess really, and why Putin feels he can do what he is doing.
The Euro continued to weaken as data shows the dole queue in Germany expanded and inflation flat-lined, yesterday their consumer climate and import prices both disappointed too. The Ukrainian/Russian conflict will also have a negative impact on the Euro.
The Pommies are still doing ok and the Canadians benefited from inflows thanks to Burger King and corporate profits, although last night the current accounts showed some further negative moves.
The Yanks however are still going strong with GDP showing good growth at 4.2%, which is higher than the 3.9% expected. Home sales also up strongly as are the prices they are getting for these sales.
Whilst the Aussie has “done my head in” with its tight 200 pip range since April, it has held up well against the US when you compare it to the other majors. In fact, it is up 4.9% this year, amazing isn’t! CAPEX rose 1.1% for the quarter and most of that is outside the mining industry. It is manufacturing and housing that lead the charge for corporate spending.