“It’s quite clear that we’re heading into a pretty sharp downturn even in Germany”
– Jennifer McKeown, an economist at Capital Economics Ltd.
German factory orders tumbled the most since 2009 in November as the euro area economy headed toward a recession and global demand cooled. Orders declined 4.8 percent from October, when they rose 5 percent, said the Economy Ministry on Friday.
“The economy is still pushing forward, but many hurdles to further acceleration remain”
– Jim Baird, chief investment strategist for Plante Moran Financial Advisors
U.S. unemployment rate unexpectedly fell to 8.5 per cent in December from 8.7 per cent in November as employment growth accelerated, offering the evidence the U.S. economy is gaining momentum. Nonfarm payrolls rose by 200,000 last month, the U.S. Labor Department said on Friday.
“If the UK can avoid recession, we expect broad stability in house prices in 2012”
– Martin Ellis, housing economist at Halifax
U.K. month-on-month house prices edged lower 0.9 per cent to 160,063 pounds in December, the lowest level in more than two years, said the Halifax Bank of Scotland on Thursday. Halifax Bank is the unit of London-based Lloyds Banking Group Plc, Britain’s No.1 mortgage provider.
“The U.S. can’t exonerate the rest of the world”
– Emmanuel Soupre, fund manager at Neuflize Private Assets
Swiss stocks declined for a second consecutive day on Friday on concern euro-area leaders have no additional measures to combat the debt crisis.
“There’s concern that the euro’s weakness is going to continue”
– Naoki Fujiwara, fund manager at Shinkin Asset Management Co.
Japanese stocks dropped on Friday as pessimism over Europe’s economic prospects outweighed strong data from U.S. The Nikkei 225 lost 1.16%, or 98.36 points, to 8,390.35, while the broader Topix shed 0.91%, or 6.68, to 729.60.
“We have revised down our 3-month EUR/USD forecast to 1.25 and during the initial quarter of this year do not expect investors to stray far from their long USD positions”
– Rabobank (based on CNBC)
After plummeting into 15 month lows, EUR/USD currency pair is expected to make an upward correction up to 1.2760/1.2820.
“We expect investors to continue hunting diversification trades. EUR/JPY, EUR/AUD and EUR/CAD are all likely to see further downside in Q1”
– Rabobank (based on CNBC)
EUR/JPY currency couple is bearish at the moment, as it is being capped by strong resistances situated at 99.92 and 100.77.
“It comes back to the issue of ugly currencies. In terms of dollar, sterling and euro, sterling comes second best”
– Bank of New York Mellon (based on Reuters)
Even though the Cable might attempt to stabilise near 1.5345 and star recovering from there, the rally is expected to be shortlived.
“As long as European growth underwhelms, the euro will continue to underperform the U.S. dollar, yen and probably also the rest of the major currencies”
– Bank of New Zealand Ltd. (based on Bloomberg)
The pair has managed to stabilize ahead of 76.22 and is now gaining bullish momentum in order to try and pierce through a key resistance located at 77.89.
“The franc’s appreciation is taking its toll on Swiss companies. However, we don’t expect a period of outright deflation as we don’t see the economy slipping into recession”
– Commerzbank AG
Provided that USD/CHF gets a foothold above 0.9548/49, the outlook will be positive for the pair.
Draghi May Copy Bernanke on Path to Low Rates
European Central Bank President Mario Draghi may act more like Ben S. Bernanke than Jean-Claude Trichet in 2012.
Fed may need to buy more bonds: Williams
The Federal Reserve Bank of San Francisco President John Williams expects that the central bank will need to buy more bonds if his forecast for subpar growth and low inflation comes to pass, the Wall Street Journal reported on Monday.
New loans beat forecast, as authorities ease credit
China’s lending and money supply grew at a faster pace than expected as the country relaxed its credit restrictions.