Binary Options News : June 18, 2013
USD Higher and Asian Stocks Lower As Fed Meets
There was slow trading in Asia overnight as low volumes and cautious investors anticipated today’s start of a two day policy meeting held by the Federal Reserve where the monetary policy of the world’s largest economy comes under the spotlight.
Helping push Asian equities lower was China’s National Bureau of Statistics reporting that new home prices in the world’s second largest economy grew 6% in May but is seen as reducing the chances of an interest rate cut and limiting the scope for monetary easing policies for China, which is looking to fight off a property bubble. House prices increased on a yearly basis in 69 out of 70 major Chinese cities
Asian stocks were lower as led by cautious trading and some disappointing data results in Asia. Australia’s S&P/ASX 200 Index fell 1.21% on the release of minutes from the Reserve Bank of Australia’s most recent meeting which offered scope for further easing. The Chinese Shanghai Composite dropped 0.56% after the Home prices data was released, with Hong Kong’s Hang Seng Index falling 0.59%. Japan’s Nikkei 225 fell 0.69% despite the JPY trading lower against the USD.
In tentative trading ahead of the key Fed Res meeting the USD was generally higher against its major pairings. The USD/JPY was 0.37% higher and the AUD/USD was 0.29% lower after the release of the RBA minutes. The EUR/USD was 0.11% lower whilst the GBP/USD was 0.20% lower, pulling back from its near 4 month high seen yesterday. The US Dollar index which tracks the greenback against a basket of 6 weighted currencies, was 0.11% higher.
In mixed and cautious trading in the commodity markets, gold dropped 0.23% and Silver fell 0.12% ahead of the Fed meeting. Crude Oil extended its gains, flirting with 2013 highs and hitting a 9 month high as Middle East concerns helped push prices of Crude Oil up 0.17%. Natural gas pulled back from the 3% rally caused on warmer weather forecasts and was 0.26% down.
UK CPI and PPR data dominate the mornings’ economic calendar along with German ZEW economic sentiment. Better than expected data from the UK should boost the GBP, whilst attention turns to the US for CPI and Housing data in the afternoon making the day a potentially volatile day in European and US trading with investors taking up positions ahead of the key Fed Reserve meeting beginning today.
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