Market Analysis Forex - 09 january 2012

As the currency markets reopened with the Asian overnight session, EURUSD opened below 1.27 this morning, touching a 16-month low of 1.2665 before rebounding slightly. Angela Merkel and Nicholas Sarkozy are meeting today in Berlin with the goal of ironing out a framework to create deficit limits in Eurozone budgets including punishments for violators. The latest UK rebuff of greater financial oversight by the European Union is complicating this discussion as they are signatories on the treaties. There is possibility of further rate cuts by ECB President Mario Draghi as he runs short on tools and time to combat the growing sovereign debt crisis. The ECB has a rate decision coming up this Thursday which is predicted to stay constant at 1.00%. Draghi could surprise markets with rate cuts and plans for expanding asset purchases.
EURJPY opened at an 11-year low at 97.27 as Asian markets trend lower in today's session. The Nikkei and Hang Seng are off -1.16% and -0.91% respectively while the Indian NIFTY is also down -0.91%. Markets are weaker in light of Europe, but comments from India's Prime Minister, who cut the country's 2012 growth forecast, are weighing on export nations as industrial production cools. Commodities have responded by moving lower as crude moves back near $101/barrel and Gold traded as low as $1604.96 before retracing. Europe remains a major risk to export dependent Asian economies as the largest economic trading bloc in the world is forecast to continue contracting.
The U.S. economic picture has continued to steadily improve as last week's employment data confirmed an expanding recovery. The unemployment rate hit a 3-year low of 8.5% and the Nonfarm Payroll figures crushed most expectations from Wall Street. Housing and consumer confidence also continued rising along with industrial production as ISM Manufacturing data recorded the best data since June. Even though corporate profit growth is stalling on Europe's contracting economy, the latest figures point to a recovery and rebound in both employment and industrial production. There wasn't much mention about the U.S. debt levels as debt-to-GDP passed 100% last week but expect this to be an important policy issue as the debt ceiling will likely be raised to accommodate further borrowing.

Related articles:

Market Analysis Forex - 06 january 2012 (2012-01-06) Market Analysis Forex - 05 january 2012 (2012-01-05) Market Analysis Forex - 04 january 2012 (2012-01-04) Market Analysis Forex - 03 january 2012 (2012-01-03) Market Analysis Forex - 28 december 2011 (2011-12-28)

International Association of Forex Traders

Company: International Association of Forex Traders
Number of participants: 30,000
Amount of payouts: 1,500,000$
Number of partner-brokers: 62
Number of payment systems: 8

eToro Forex Broker

eToro Broker Reviews
Notes: Weekly Championship
Min Account: 50$
Spread: 2 Pips

ACM

ACM Review >>
Notes: Worldwide Broker
Pips: 1.8
Max Leverage: 1:100
Rating: 10

Markets

Markets Broker Review
Notes:Brand New Broker Platform
Min Account: 50$
Bonus: $2000

Plus500 Forex Broker

Notes: No commissions! - fixed spreads
Min Account: 100$
Trade Stocks, Forex, CFDs, Indices, Oil and more

AVA Fx Forex Broker

AVAFX Broker Reviews
Notes: Easy Platform
Min Account: 100$
Max Leverage: 1:200

FXCM

AskoBid

askoBid Broker Review
Notes: Simple and new broker
Bonus: 30% reward on first deposit