Morning Call

US traders come back to their desks today following the public holiday for Independence Day, and are greeted by the pivotal US jobs release. What are US Non-Farm Payrolls? The US Department of Labor releases a monthly employment report for goods, construction and manufacturing. It is usually release on the first Friday of the month; though this can differ (it is officially the third Friday after the end of the reference week). Median estimate Each month analysts attem…

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*In the US it is a national holiday today, Independence day. This will affect the trading hours of certain markets with us remaining closed for the session, please see your client emails for further details* The markets seem relatively subdued this morning ahead of BoE and ECB announcements, with the US closed for Independence Day volumes are likely to be lower. Bank of England Mark Carney began his term as the first foreign national to become the Governor at the Bank of En…

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This morning the Ex-Bank of Canada Governor begins his role as the new Bank of England Governor, taking over from Sir Mervyn King. Carney is the first foreign national to hold the senior post on Threadneedle Street, and many are hoping he will be able to work miracles. The UK economy is just beginning to show the green shoots of a recovery following a deeper recession than previously thought according to the ONS. The BoE has attempted to reignited growth with ultra-loose monetary polic…

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A top US central banker on Monday warned the “feral hogs” of financial markets against overreacting to the Federal Reserve’s plans to slow its bond buying, as yields on US Treasuries climbed to their highest level since August 2011 - FT Deutsche Bank cuts commodity forecasts: Gold by 7% for 2013 and cuts 2014 price by 11% Ex-Italian PM Silvio Berlusconi was sentenced to 7 years in jail and banned from holding office on Monday after being found guilty of having s…

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The FOMC met on Tuesday and Wednesday with the head of the Federal Reserve Ben Bernanke announcing as expected to leave rates unchanged at 0.25% and current policy unchanged. Trading throughout the European session on Wednesday had been subdued as traders awaited Bernanke’s speech and Q&A session to see when tapering of the current quantitative easing programme would occur. Speculation, as to when “tapering” would occur, has been the topic for analysts and market commen…

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Asian stocks climbed, after the regional benchmark index yesterday erased this year’s gain, as U.S. economic data beat estimates and on concern eased that the Federal Reserve will reduce record stimulus - Bloomberg Goldman Sachs strategist’s call for Chinese growth at 6% - WSJ China, the world’s largest iron ore buyer, scrapped a licensing system for imports of the steelmaking raw material, according to two industry executives - Bloomberg WSJ’s Hilse…

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UK RICS house price gauge is at a 3-Year high, fuelled by sustained low borrowing costs and the government incentives to help boost the property market. However concerns are growing that the belief of historically low interest rates becoming the “new normal,” could lead to a blood bath as mortgage payments increase when rates do eventually rise. SNB's Danthine: Exchange Rate Floor Necessary to Advance SNB Mandate - WSJ S&P upgraded the US rating outlook to sta…

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Japan's stocks entering a correction, dropping more than 10% from their peak -Bloomberg Each $1 in credit firepower added the equivalent of 17 cents in GDP, down from 29 cents last year and 83 cents in 2007 (China) -Bloomberg The Government must continue with its deficit reduction plan if it wants to turn the UK’s economy around and establish the recovery, the influential Organisation for Economic Co-operation and Development (OECD) said yesterday Euro area data,…

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Trading through the European and US session on Monday was very quiet as there were public holidays in the US and UK, leading to limited volatility and lower trade volumes. The majority of FX crosses traded in relatively tight ranges with limited macro data to give direction. The Aussie dollar has weakened against the Greenback over the last 6 weeks; analysts have been vocal for a prolonged period that the Aussie has been overvalued. The AUD strength has been fuelled by the commodities…

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Ben Bernanke took centre stage yesterday, as he read a prepared text stating that that he sees no benefit in tapering of QE, pushing Gold up around $30 to over $1400/oz, with the expectation of prolonged money printing. After the prepared text, Ben Bernake held a Q&A session, which he subsequently stated that if employment and US data continued to improve then over the “next few meetings” the Fed could begin to taper. These comments led to a whipsaw in markets, as traders rev…

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Bank of England Minutes of the MPC Meeting Held on 8 and 9 May 2013: http://www.bankofengland.co.uk/publications/minutes/Documents/mpc/pdf/2013/mpc1305.pdf Above is the link to the Bank of England website, for the full PDF release. The link is hosted on an external website, which Abshire-Smith do not take responsibility for its content or any liabilities.…

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The Bank of England releases their minutes from the previous MPC meeting at 9:30am, the immediate headline will be how the members voted on the interest rate and asset purchases. Investors will then look for a change in stance or hints regarding the future policy; interest rates have been held at a historic low since 2009. The current does of ultra-loose monetary policy will need to be withdrawn at some point in the not too distance future, though analysts believe that the next Governor Mark…

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There is a growing concern that the UK government’s flagship scheme to help first time buyers access the housing market will fuel a property bubble. On Monday according to data released by Rightmove, theaverage house price in London is now above £500,000 for the first time. Low borrowing rates, demand outstripping supply and buy-to-let rental yields have all fuelled the surge. Analysts are highlighting that the Chancellors scheme to help many individuals access the property marke…

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