Forex News

The Pound ran into resistance at 1.62 after pushing higher for most of today's trading session. Position comments from BOE policy makers increased yields in the UK, adding momentum to the Sterling. Bank of England policy maker Andrew Sentance said the BOE should could consider raising interest rates to boost the value of pound. His theory is that a higher Pound would decrease import prices and calm inflation. Sentance has long been the most hawkish on the MPC. Market expectations for BOE tightening have crept up steadily, with 1 year OIS moving from less than 10 basis points in October to a high of 87.5 basis points on Tuesday. The Pound closed above the 1.6170 level and is poised to test resistance at the 1.63 level. The Sterling is creating a reverse head and shoulder pattern and a break of 1.63, should lead to upside toward 1.70. China State Administration of Foreign Exchange (SAFE) estimated that $35.5 billion of “hot money” flowed...

The release of the recent Fed's meeting minutes did not come away of what has been seen of pledges of keeping its quantitive easing policy for spurring growth and demand for jobs expecting the recent rising of oil and commodities prices to have benign effect on the inflation which is expected to be well-contained over the long term by the Fed unable to cause a major change of its stimulating policy for supporting the growth which has not stored durable confidence in the housing and labor markets until now but the Fed's upgrading of its growth expectation of this year from 3% to 3.6% to 3.4% to 3.9%came to the market as a new reason to have more risks pushing the US stocks up. While the British pound came under pressure again after King's comments which brought down in the interest rate outlook in UK which has been up by the release of Jan UK CPI which reached 4% moving the...

The dollar consolidated against the Yen after moving higher during 10 of the last 11 trading sessions. Higher rates in the US based on stronger inflation figures and better than expected economic data, has dollar bulls salivating. The US, Japanese interest rate differentials have been driving the currency pair. Today the markets needed to absorb news of higher than expected Wholesale Price inflation. The Producer Price Index (PPI), rose a seasonally adjusted 0.8% in January from December, according to the Labor Department. The majority of the rise was in energy prices. Core PPI, which excludes food and energy, increased 0.5% last month. Economists expecting a 0.9% increase in overall producer prices and a 0.2% increase in the core index. This follows a greater than expected increase in import prices yesterday. Higher inflation leads to higher yields in the long end of the interest rate curve, which has pushed the US - Japanese 10 year yield spread to 100 basis points. Additionally in...