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Recommendation From Goldman Sachs Exits Long Euro Vs Dollar With 4.2% Loss

fxbom.com
01:16 PM

SINGAPORE -(Dow Jones)- Goldman Sachs said Friday it has exited a long-euro recommendation, a trade that would have lost 4.2%.

The euro’s drop below $1.35 means “our long (euro/dollar) recommendation has finally been stopped out for a theoretical loss of 4.2% including carry,” the bank said in a research note.

Goldman Sachs didn’t say when it had recommended going long but said the call had been backed by “two main assumptions: continued dollar downside pressure and a gradual decline in the fiscal risk premium in the euro zone.” But the euro instead has fallen on “the recent sharp increase in risk aversion, much of this originating in Europe, and upward pressure on the (dollar) across a wide range of currencies lately.”

Currencies Stabilize After US Sell-Off

fxbom.com
12:56 PM

SYDNEY -(Dow Jones)- Currencies stabilized early in Asian action Friday after Europe’s deepening financial distress panicked investors in the U.S., with riskier currencies such as the Australian dollar plummeting and the U.S. dollar surging.

In the U.S. sell-off that saw the Dow Jones Industrial Average close down nearly 400 points, the U.S. dollar hit an eight-month high against the euro and a one-year high against the British pound as the desire for safety trumped the potential for higher returns in fear-stricken markets. With the euro zone’s long-running debt woes showing no signs of abating, investors were preoccupied by the risk of Greece defaulting on its debt and unleashing a global financial pandemic.

Polish MPC: No Need To Cut Interest Rates – September Minutes

fxbom.com
09:28 PM

WARSAW -(Dow Jones)- Poland’s inflationary and economic perspectives don’t suggest a need to cut interest rates, the country’s Monetary Policy Council said in minutes of its September meeting.

The MPC left interest rates unchanged during the meeting, with the benchmark rate at 4.5%. It’s ready to continue the tightening cycle–after four increases by a total of one percentage point so far this year–if consumer price inflation remains stubbornly above the central bank’s 2.5% target, it said. The CPI was at 4.3% on the year in August.

UK’s Small Firms Borrowing Less, Saving More – BBA

fxbom.com
06:02 PM

LONDON -(Dow Jones)- Small firms in the U.K. are hoarding more cash and borrowing less in 2011 than they were in 2010, according to data published Thursday by the British Bankers’ Association.

The BBA said so far this year banks have extended GBP506 million a month, on average, in new loans to small and medium-sized firms, compared with GBP539 million a month last year and GBP664 million in 2009.

Euro-Zone Industrial Orders Pace Slows

fxbom.com
06:01 PM

LONDON — Factory orders in the 17 countries that share the euro rose in July at the weakest year-on-year pace since November 2009, as demand for goods eased across much of the region, data showed Thursday.

European Union’s statistics agency Eurostat said new industrial orders fell 2.1% on the month in July and grew 8.4% on the year.

The annual gain was the lowest since a 2.6% year-on-year fall in November 2009, while the monthly decline was the biggest since a 4% drop in September 2010.