The following are the most recent pieces of Forex fundamental analysis from around the world. The Forex fundamental analysis below covers the various currencies on the market and the most recent events, announcements, and global developments that affect the Forex market.
Forex Fundamental Analysis
Forex Fundamental Analysis
Governments use bonds as a mechanism of securing financing from the markets. Traditionally, government bonds have been regarded as a low risk investment vehicle since the prospect of default is remote. However, in the aftermath of the global financial crisis, national debt and the cost associated with it has come under scrutiny.
Germany has the biggest economy within the European Union and is the world’s second largest exporting nation behind China. After a pretty horrible 2009, figures just released for 2010 by the German national statistics office put growth at a provisional 3.6%. This is in stark contrast to the 4.7% contraction seen a year earlier.
The EU and IMF have underwritten bailouts to Greece and Ireland which total €195 billion over three years. Effectively, both nations will have access to guaranteed funds at an interest rate which is significantly lower than the market rate being demanded of them, but above the rates that some EU members themselves are charged in the bond market.
The yield on a bond is the amount of interest that the issuer will pay to the investor for purchasing the debt. The higher the investment grade of the bond is, the more certain it is that an investor will be repaid his money when the bond falls due and, consequently, the lower the yield.
Last week saw all of the world’s major stock close higher than they had started the week. In Europe over the course of the week, the FTSE made 0.22%, closing at 984.3; the Dax rose by 0.49% to close at 6947.8; the CAC gained 0.38% to end the session at 3865.6.
Towards the end of last year, various economic indicators suggested that the US economy had been performing better than expected. This has led to speculation in some quarters that plans the US Federal Reserve announced in November for a second round of quantitative easing would be put on hold.
Crude oil is a versatile commodity. Apart from the obvious uses of the refined products as fuels for aviation; cars; tractors and trucks (kerosene; petrol; diesel), it is used to produce lubricants, plastics and as a feedstock for certain types of pharmaceutical production
For the first time, the World Bank has issued an investment bond denominated in the Chinese currency, the Yuan (which is known as the Renminbi, or “people’s currency” in China). As many people expect the value of Yuan to rise since they believe that the Chinese have kept the value of the currency artificially low, the issue may attract a lot of investors.
The British Pound has been among many currencies, which fell hard in relation to the Swiss Franc. Just like the Euro and the Dollar, the Pound sank to an all time low, recently extending to 1.4398. On Tuesday, however, the GBP-CHF rebounded significantly in the largest single daily gain since October.
With the last round of the sovereign debt crisis barely a month old and some commentators being openly sceptical about the long-term viability of the single European currency, it might seem an odd time for the Eurozone to expand. However, that is just what has happened. On New Year’s Day, Estonia became the 17th member of the Eurozone, officially relegating its currency, the Estonian Kroon, to history.
Last Friday marked the end of the week, the month, the quarter and the year for 2010. It was a poor week for the world’s major stock exchanges last week with all of them closing lower by the end of what is traditionally a quiet working week. In Europe over the course of the week, the FTSE shed 0.42%, closing at 5971.1, but it strengthened by 7.9% over the course of the year; the Dax fell by 2% to close at 6914.2, but put on 14.5% over the year; the CAC fell by 1.6% to end the session at 3850.8 it lost 4.8% in 2010.
The total Spanish debt is estimated to be equivalent to 53.2% of the nation’s GDP and the cost of borrowing to service the debt (through the issue of government bonds) has risen in the wake of the sovereign debt crisis and fears that Portugal and/or Spain may be next in line for an EU/IMF bailout package. Moody’s downgraded the country’s credit rating from its top AAA rating to Aa1 in September and has suggested that a further downgrade is on the cards. The country has yet to emerge from recession, but is expected to do so in the course of the New Year.
Approximately 70% of American output is consumed within the nation. This is why consumer data and items such as new home construction provide key indicators of the health of the world’s largest economy. With the festive period, consumer sales usually show a strong performance towards the end of a year, partially because of increased seasonal spending but also since many non-seasonal goods are also discounted in end of year sales.
Switzerland is a Federal state made up of its cantons. It has three main languages; French; German and Italian. The country is not part of the European Union although it is a member of the European Free Trade Association (EFTA) and it has its own currency, the Swiss Franc. The country, unlike many developed economies, is not saddled by huge debts and has a low rate of unemployment.
China may have eclipsed Japan to take on the role as the world’s second largest economy, but that doesn’t change Japan’s place in the word in economic terms to any significant extent.