The Australian dollar continues looking good. After Australian employment data seemed good enough, figures from Australia’s No. 1 trade partner look even better. China reported a growth rate of 6.7% in Q2 2016 slightly better than 6.6% expected and identical to Q1. Industrial output surprised to the upside with 6.2% instead of 5.9% expected and 6% last [...]

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A villain murdered more than 80 people celebrating France’s Bastille Day in Nice, southern France. The horrific stampede is clearly an act of terror and it joins previous attacks in Paris and in the Brussels, Belgium. France has extended the state of emergency hours after President Hollande announced the planned removal of this measure. We also heard that [...]

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A mixed jobs report from Canada: the nation lost 0.7K jobs instead of gaining ones. However, the unemployment rate dropped to 6.8%. The participation rate slides to 65.5%, and that explains the drop in the unemployment rate. All in all, a slightly disappointing publication from Ottawa.  USD/CAD is at 1.3030, up, but that’s mostly because of the great [...]

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Analysts from Lloyds Bank point out that next week main events in the United Kingdom will be the testimony of Mark Carney on Tuesday and the second reading of Q1 GDP on Thursday.

Key Quotes:

“In the UK, Bank of England Governor Carney (Tue) will appear before the Treasury Select Committee to answer questions on the latest Inflation Report. He will no doubt face questions about the economic forecasts, including his views on the potential risks surrounding the EU referendum.”

“Data wise, we expect the second estimate of UK Q1 GDP (Thu) to be unrevised at 0.4%q/q, though there will be the first expenditure breakdown of the figures which should show consumer spending remaining firm and a rebound in investment after the contraction in Q4.”

“The GfK consumer confidence index (Fri) will provide a more up-to-date indicator of sentiment in the current quarter. The index fell to a 16-month low of -3 in April, though we look for stabilisation at the current level in May. BBA figures on house purchase loans (Thu) will also be watched to gauge the impact of the Chancellor’s stamp duty levy on second homes which began in April.”
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According to an article from Nikkei, the Bank of Japan set funds aside for the first time in order to prepare for losses from its purchase program that could take place once the easing program ends in the future.

Key Quotes from the article:

“The Bank of Japan likely set aside funds for the first time to prepare for losses on its huge holdings of Japanese government bonds should the central bank end its monetary easing policy in the future.”

“The bank is thought to have reserved about 450 billion yen ($4.07 billion) for the year ended in March. The amount will become known when the BOJ releases financial statements as early as next week.”

“Though BOJ Gov. Haruhiko Kuroda has indicated that the bank could expand easing if it faces difficulty achieving its inflation target, the creation of the reserves is a move to prepare for an exit from monetary easing.”

“The BOJ pays most of its net income to the government, and this payment will decline if the bank sets aside reserves. Furthermore, the central bank's profits have suffered from the lower value of foreign-currency assets due to a stronger yen. As a result, payments to the government are estimated at 400 billion yen for fiscal 2015, down sharply from 756.7 billion yen in the prior year.”
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  NEW YORK, March 11 The dollar fell on Friday, nearing a one-month low against a basket of major currencies, as investors bought riskier assets following surprising announcements from the European Central Bank and People’s Bank of China. Commodities rose on Friday after China fixed higher its onshore yuan rate ...

Weak oil prices pose a threat to Gulf Arab states’ currency pegs against the dollar, but the energy-rich region is unlikely to abandon the policy yet, analysts say. Bahrain, Oman, Qatar, Saudi Arabia and the United Arab Emirates all keep the values of their currencies fixed against the greenback, while ...

Today’s British pound to euro rate (GBP/EUR) trends under the €1.30 mark having seen the best consecutive daily run in months cut short by several UK PMI’s printing below-forecast. We examine the latest euro-related fx forecasts targeting the Sterling and the US dollar in the short, medium and longer-term currency ...

For the weakening British pound, the worst may not be over. Derek Halpenny, head of global markets research at Bank of Tokyo-Mitsubishi UFJ, said there’s scope for major drops in the currency as the “Brexit” debate rages on. “I think we’re still in for potential further declines,” Halpenny told CNBC’s ...

The People’s Bank of China withdrew 840 billion yuan ($129 billion) from the country’s financial system in five days through Friday, its biggest weekly withdrawal since February 2013, according to data compiled by Bloomberg. PBOC was mopping up excess liquidity infused in the market by the central bank’s decision to ...