$ U.S. Dollar Extends Gain after April New Home Sales Exceed Forecast

23 May 2012 15:12 GMT THE TAKEAWAY: U.S New Home Sales Rose 3.3 Percent in April> Recovery in Housing Market Helps Boost Economic Growth > U.S. Dollar Extends Gain
Purchases of new single-family houses in the U.S. bounced back more than forecast in April after hitting four-month low in March. Coupled with rebound in April existing home sales, a surge in new home sales fuels investors’ optimism over recovery in the world’s biggest economy since animprovement in the housing market helps boost consumer expenditure and spur demand in durable goods in coming months.
New home sales climbed 3.3 percent at a seasonally adjusted annual rate of 343,000 units,U.S. Census Bureau and the Department of Housing and Urban Department jointly reported today. The print is well above median projections of 335,000 units from the Bloomberg News Survey. Meanwhile, sales in March were upwardly revised to 332,000 units from 328,000 units. Still, sales of new homes were far from the average 700,000 annual rate that recorded in healthy market.
Recent improvements in labor market and exceptionally low mortgage rate made home more affordable for new buyers in some parts of the country. April new house sales advanced in three of four U.S. regions. The Midwest registered the biggest monthly gain, up 28.2 percent to 50,000. Similarly, sales in the West mounted to 88,000. On the contrary, new house purchases in the South unexpectedly tumbled 10.6 percent to 177,000 units.
The median sales price of new house sold in April was $235,700 while the average sales price was $282,600. Besides, house price index gained 1.8 percent last month compared to 0.3 percent increase in March, Federal Housing Finance Agency said today. House price purchase index rose 0.6 percent in the first quarter in contrast to 0.1 percent decline in the previous quarter.
USDCAD 1-minute Chart: May 23, 2012

Chart created using Strategy Trader – Prepared by Trang Nguyen
The U.S. dollar strengthens versus most of its major peers except its Japanese trading partner about Greece’s debt problems and more rumors on Greek Euro exit. The greenback extends gains against the single currency after the home sales report. TheRelative Strength Indicator crossing below 30- territory during thirty minutes signaled that forex trading crowd was aggressively selling off euro in favor of greenback. At the time this report was written, the euro trades at $1.2582, below 20- and 50- minute exponential moving average lines.

Loonie Remains Strong after Canada's April Inflation Rose More than Forecast

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By Trang Nguyen, 18 May 2012 13: 34 GMT THE TAKEAWAY: Canada Consumer Price Index Rise 0.4 Percent in April > the Inflation within Target Encourages Bank of Canada to Preserve its Low Interest Rate Policy throughout 2012 > CAD Remains Higher

Canada's inflation remained stable at 0.4 percent in April for the fourth straight month as rising price pressures on cars and clothing offset easing pressures on energy and gasoline.

Canada Consumer Price Index is at a current level of 122(2), up 0.4 percent from121.7 in the previous month, the Ottawa - based Statistics Canada reported today. As such, the consumer prices remained stable at 0.4 percent for the fourth straight month. The reading exceeds 0.3 percent gain projected, according to the Bloomberg News survey. Over a year prior, the all items index regained to 2.0 percent from 1.9 percent in March.

The rise in year-to-year cost of energy substantially softened to 1.1 percent in April, following 5.1 percent increase in March and 7.2 percent upsurge in February. Similarly, gasoline prices climbed only 3.3 percent last month compared to 6.6 percent and 8.9 percent in the previous two months. Meanwhile, transportation costs surged 3.2 percent in the twelve months to April while the food prices advanced 2.5 percent.

The Bank of Canada's core index rose 0.4 percent on monthly basis and gained 2.1 percent on yearly basis. Those numbers are consistent with the Bank of Canada's forecast last month that consumer prices would advance average 2 percent this quarter and 2.2 percent in the second half of the year.

USDCAD 1-minute Chart: May 18, 2012

Chart created using Strategy Trader - Prepared by Trang Nguyen

The Canadian dollar gains ground versus most of its major counterparts ahead of an opening bell in North America trade today. The loonie immediately extended advance in the minutes following the Consumer Price Index report. Canada's April inflation meets its central bank target of 2.0 percent, thus indicating low chance of rate hike in near term. As seen from the 1-minute USDCAD chart above, the currency pair fell about 30 pips from 1.0160 to 1.0140. Nonetheless, the greenback quickly saw a correction after thirty minutes, trades at $1.0166 at the time this report was written, higher than its level before the data release.

-Written by Trang Nguyen, DailyFX Research Team for DailyFX.com

To contact Trang, email tnguyen@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
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18 May 2012 13: 34 GMT

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|| Vulnerable Euro Bond sale results, German forecast update

Discussion points
Euro seems vulnerable on the Italian and Dutch Bond Auction results Germany to release the value of macroeconomic forecast updates for 2012 Australian Dollar sank after ICC disappoints, stimulate the RBA cut rates Paris the Euro is in a precarious position that views on the results of auctions of binding andItalian Dutch markets and the release of macro-economic forecasts updated by the Ministry of the German economy. Rome will sell coupon 2014 debt and inflation-linked 2017 and 2019 paper while Amsterdam is 2014 and 2037 links. Traders will be be keeping a close eye on the average yields of signs of sovereign stress of return.
The auction comes in the growing concern that the anti-austerity feeling fuels political instability in the region and can undermine the efforts of debt reduction. French President Nicolas Sarkozy lost in the first round of his re-election challenger anti-austerity campaign Francois Holland over the weekend in Dutch Prime Minister Mark Rutte and his cabinet resigned yesterday, having failed to agree on additional measures for deficit reduction.
During this time in Germany, a set of update of the official Government forecasts will be size against readings of PMI manufacturing and services April sharp drop of yesterday. Officials cut their prospects for growth of GDP 2012 to 0.7% in January of 1.0% in October of last year. A further reduction could to influence the risk appetite - stimulating Mint haven such as the Dollar and the Japanese Yen - that the dominant across financial markets theme is the degree to which a recession in the euro area will be derailing world production as a whole.
The lower Australian Dollar in trade during the night, collapse up to 0.8% against its major counterparts, after the digits of the price index dropped by forecasts of economists and strengthened expectations of an RBA interest rate cut next week policy meeting. The report shows that annualized inflation rate fell to 1.6% in the first quarter, the lowest in two years and a half.
More worrisome, the decrease in percentage of 1.5 point rate of 3.1% in the three months to December 2011 marked the largest quarterly decline in more than a decade. Markets, now the price of the certainty of a 25 bps decrease the rate of loan of reference with a slight possibility of a greater reduction, according to data compiled by the Credit Switzerland. The prospects for 12 months implies now 110 bps overall relaxation.
Asia session: What happened
Corporate price (YoY) (MAR)
Index of consumer prices (QoQ) (first quarter)
Index of consumer prices (YoY) (first quarter)
Weighted median RBA (QoQ) (first quarter)
Weighted median RBA (YoY) (first quarter)
Conference Board leading economic index (MAR)
Credit card spending s.a. (MoM) (MAR)
Credit card, spending (YoY) (MAR)
Session of the euro: what to expect
Of France (APR) consumer confidence indicator
Survey companies of France - aggregate demand (APR)
Netherlands to sell 2014-2037 links
Italian hourly wage (MoM) (MAR)
Italian hourly wages (YoY) (MAR)
Public finances (PSNCR) (£) (MAR)
Sector public borrowing Net (£) (MAR)
Italy sells 2014 zero-PCN, 2017-2019 I / L links
German Econ Department publishes forecasts
Critical levels

(((Forex Trading weekly forecast - 04.16.2012)))

 14 April 2012 strategist 04: 43 GMT
 

technical analysis on trends affecting the global currency.

14 April 2012 04: 43 GMT  Apr, 14 05: 36 GMT Dollar rallies at the end of the week, risk trends will remain Top ConcernApr, 14 04: 25 GMT US Dollar ready to break Impasse, eyes on earnings and the RatesApr, 14 04: 22 GMT Euro Sticks to the beach, but losses probably on the Spain and the Italy TroublesApr, 14 04: 21 GMT or advance short term with respect to the Point LowerApr croissanceTech04: 19 GMT 14 Japanese Yen force Fizzle in the fears of growth, proof of the BoJ