Phoenix, AZ (PRWEB) August 01, 2012
US central bank actions and payroll data have weighed heavily on global growth expectations, leading to risk sentiment falling into sharp decline at the end of the week in European trading. EURUSD fell back to fresh two-year lows, touching 1.2266 earlier in the week, while the AUDUSD has dropped below 1.02 and the USDJPY backed down to 80.00.
iForexnews.com, the leading forex trading news website, stated that US payrolls data was the chief driving force behind last week’s sell-off, and revealed that the situation is unlikely to improve anytime soon.
Dan Lim, senior market analyst at iForexnews.com, today provided his own insights into the sell-off last week:
“80K is a poor number – maybe not bad enough to warrant the Fed taking any more action just yet, but certainly not good enough to give us any hopes of a summer recovery. It seems as if the Fed isn’t too keen on the QE anyway, and it takes a lot to get them to do anything more with the Committee being split on whether or not to add more stimulus to the US economy. “
“While the Fed has revised its growth forecasts since the meeting in June, it remains unwilling to provide any help to boost growth for the remainder of this year.”
iForexnews.com added that the news is not only significant for forex traders, but also for stocks and commodities. It explained that markets are now experiencing an adjustment phase, falling to a level that would better suit an environment with lots of debt, not much official support and not much growth.
“Even those banks which are actively seeking to loosen monetary policy, such as the ECB, cannot give markets what they need,” explained Dan.
“For instance, the ECB has cut deposit rates to naught percent, but this hasn’t helped to stop the rise of Spanish bond yields, which ended the week desperately close to 7%, which is considered to be sovereign bailout territory.”
iForexnews.com is a leading news site for the forex trading industry, providing real-time updates and up-to-the-minute news on forex markets around the world. With regular news reports published each day, as well as dozens of helpful articles about forex strategies and tools, iForexnews.com has become a vital resource for thousands of forex traders. Find out more, visit their website at http://www.iForexnews.com.