“The austerity package will be sufficient to bring [Italy’s] deficit-to-GDP ratio down to zero”
– Chiara Corsa and Loredana Federico, economists at UniCredit SpA
Italy’s senate passed a vote of confidence 257 to 41 on Prime Minister Mario Monti’s emergency budget plan on Thursday as the government struggles to restore investor confidence in the euro zone’s third largest economy.
“The employment situation continues to show strong signs of a recovery”
– Andrew Wilkinson, chief economic strategist at Miller Tabak & Co.
The number of Americans claiming for unemployment benefits dropped to 364 thousand in the week ended December 17, the lowest level since April 2008, said the Department of Labor on Thursday. Economists expected the reading to increase to 376 thousand.
– James Knightley, an economist at ING Bank
U.K. gross domestic product grew revised 0.6 per cent in the third quarter of 2011, faster than previous estimates of 0.5 per cent, said the Office for National Statistics on Thursday. The Bank of England expects the economy to stagnate in the fourth quarter and in the beginning of 2012.
CHF
“European stocks are very cheap and in the absence of bad news, they should rise”
– Thomas Haerter, chief strategist at Swisscanto Asset Management AG
Swiss stocks rose for a fourth consecutive day on Thursday after a report showed U.S. jobless applications decreased and consumer sentiment improved, a sign that the world’s largest economy is recovering.
JPY
“The ECB doesn’t seem to have stepped up to the plate for bond buying, which I think is negative”
– Shane Oliver, head of investment strategy at AMP Capital Investors Ltd.
Japanese stocks fell on Thursday as record borrowing from the European Central Bank showed how deeply the debt crisis has affected the financial system. The Nikkei 225 shed 0.77%, or 64.82 points, to 8,395.16, while the broader Topix lost 0.35%, or 2.56, to 723.12.
“This [Eurozone] crisis is not even near to being resolved”
– Commerzbank (based on Reuters)
EUR/USD’s outlook is still negative, as the pair is likely to carry on falling from 1.4246. Resistance should prevent the price from advancing, while a breach of the immediate support at 1.2946 would indicate a further selloff down to 1.2873.
“The market continues to wait for political leaders to make political decisions on the future of the euro zone”
– BNY Mellon (based on CNBC)
While a key resistance located at 102.98 is intact, the bias will remain bearish for the currency pair. At the moment EUR/JPY is heading toward 101.04, a break of which will imply the possibility of decline down to 99.92.
“There is a growing likelihood of a slide [for UK] back into recession in the New Year”
– Markit (based on WSJ)
The British Pound – American Dollar currency pair is anticipated to act calmly on Friday. The initial resistance is situated at 1.5779, while support at 1.5557 is likely to halt downward movement.
“There is a growing likelihood of a slide [for UK] back into recession in the New Year”
– Markit (based on WSJ)
The British Pound – American Dollar currency pair is anticipated to act calmly on Friday. The initial resistance is situated at 1.5779, while support at 1.5557 is likely to halt downward movement.
– GFT Forex (based on Bloomberg)
USD/JPY is likely to continue trading within a corridor formed by a support at 77.49 and by a resistance at 78.28, therefore the outlook is neutral. In case the latter level is violated, the price might target 78.84 next.
Italy to Kick the Cash Habit as Monti Cracks Down
The government on Dec. 4 reduced the maximum allowed cash payment to 1,000 euros from 2,500 euros.
US Republicans in climbdown on payroll tax deal
House of Representatives Republican Speaker John Boehner has agreed to accept a bipartisan deal to extend a payroll tax cut, in an abrupt U-turn.
Asia markets rebound after U.S. gains
”Stocks are rebounding, but sentiment is still very wait-and-see because of the long holiday,” said Conita Hung, head of equity markets at Delta Asia Financial Markets in Hong Kong, where markets were also slated to shut Monday and Tuesday.