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BOC Disappoints the Market Investors After Today’s Meet
GDP growth rate rises up to six percent that is beyond the expectations of annualized rate. As we have noticed that it grows up to 0.6 percent in the month of March as compared to the Feb. growth rate that is of only 0.3 percent.
It was anticipated in the market that the Canadian Dollar is expected to rise up until the meet of BOC members that will be held today. The market is expecting that the BOC will be the first G7 Central bank that begin the tightening in the market.
Today after the meet the BOC has declared that it will not change the interest rate prices from 4.5 percent in June. This mainly impacts on the prices of Australian dollar as it falls after this announcement.
Risk sentiments gets weigh after the dis-satisfying PMI data comes from China and it also embedded risks in the market situation. There was a drop down shown in the Asian market that are generally lower than Nikkei at some point.
RBA specified the main cause of the policies recently made by European countries to stabilise the Forex market situation along with providing the bond market, liquidity in the market, cut budget deficits and so on.
Asian investors get dis-appointed after the release of manufacturing data of China. since in may month there was a drop down shown in the market of 53.9 that was more than expected by the market.
Since the market is hoping for some good decision today from the BOC’s end but the hopes faded as the euro zone debt crisis escalated and there was a certainty of only 50 percent rate hike that came into existence.
Therefore now the market is looking for the nest meeting that should be held on coming Monday for the further action that world be carried out for the Global economic development.
Euro Backslides to 18 Months Subside
Since the European financial situation stimulated the need for safer investments Gold prices reached an all-? ?time.? ?The Gold prices lowered later in the week but ended two percent higher.
Safer investments boosted the prices of the U.S dollar? ?to? ?the highest level against a number of currencies.
U.S crude oil prices collapsed by? ?nearly? ?4%? ?and the Nasdaq and? ?S& ?500? ?fell by nearly? ?2%.? ?Stock prices? ?.? ?Despite the fact that U.S retail sales and industrial production rose in? ?April? ?,? ?the stock prices
and oil prices fell significantly.
A rescue plan of nearly? ?$1Trillion was announced this week by the European authorities for Greece and other Euro zone countries in debt.? ?But even the investors doubted about the poor public finances.
Just day after when the Senate voted for limiting? ?the fees charged on credit and debit card transactions,the shares of credit card companies came down?.
?MasterCard Inc lost? ?8.5? ?%? ?to? ?$212.45? ?and Visa Inc lost? ?9.9%? ?to? ?$77.26. The same trend followed? ?with the banks? ?.? ?The Spanish banks Santander? (?SAN.MC?) ?and BBVA(BBVA.MC?) ?fell? ?9.0? ?and? ?7.6? ?%? ?respectively.? ?The STOXX Europe? ?600? ?banking index?. SX7P fell by? ?5.2? ?percent.
Also the Price of the U.S crude oil fell by? ?3.75%? ?to? ?71.61%? ?a barrel.? ?This was recorded as? ?the lowest since February? ?5 in Forex market.
Gold recorded a record high of? ?$1248.95? ?but when the gold failed to cross the psychological level of? ?$1250,? ?the investors started to sell it.? ?Some sold it to recover their losses in stock market also.? ?Later Gold sold practically flat at? ?1230.05? ?per ounce.
Equity funds in emerging markets? ?attracted less money while risky-high-yield bond funds attracted high money,? ?a five-? ?year high.?
?As the investors moved back to cash the money market funds attracted new money this week for the first time since January.
Forex: EU Finance Meet On Rescue aid-Package results in Euro Gains
On late Friday, it seems shocking for the traders when the EURO currency hits a high of 1.2908 US Dollar against all the leading currencies of Forex market. Analysts provides a successful conclusion to a EU Finance ministers meet held in Brussels on last Sunday results in instability in Forex currency trading market when opens on Monday morning.
An EU diplomat said that- in the meeting the finance ministers are trying to convince everyone about creating a EURO 600 billion fund to bring stability in the 16-state EURO zone.
However, the EURO 600 billion fund is still in halt and has been not agreed yet. The diplomat is also saying that the size of the fund can also be changed before the final pact. Instability in the market will continue until a final outcome will come of Greece aid-package.
Since, the market aspirants are waiting for the details of European Union package which was at halting stage. The euro seems to be higher in early Asian trading but currency trading market is still in the same volatile condition. Market is thinking about the “the bigger the better size wise” before taking any decision about the Greece package fund.
Experts of the market are suggesting to the investors and traders to get involve in a new system launched that is Government-Backed loan guarantees along with some form of liquidity support offered by the European Central Bank.
Since, analysts are saying that market is showing volatility and it remains until a specific and clear details about the Greece aid-package have been revealed to the market aspirants. On Friday, the Australian dollars hits a high of US dollar 0.9000 more than a percent from US Dollar 0.8886 as risk aversion eases whereas the New Zealand currency was at US Dollar 0.7205.