The Fourth-Quarter GDP in Germany

[The Fourth-Quarter GDP in Germany]

Destatis announced on Feb.15,2011 that German fourth-quarter economic growth was still strong in 2010 as the international business developed steadily.

 

According to the record, German fourth-quarter GDP increased by 0.4% than last quarter, which was less than the expectation of 0.5%.

 

The net export was the main driver for the economic growth. In addition, Germany GDP was increased by fixed investment and domestic consumption.

[EUR/USD Would Drop on Risk Aversion]

The forex rate of US dollar against non-US currencies went up as US dollar index rose and Euro weakened on debt crisis. It was predicted that Euro would continue to drop this week.

 

The analyst pointed out that social situation in Egypt had not been stable completely. At the same time, the economy in Egypt would have huge uncertainty after its politics was stable. Then USD rose on risk aversion.

 

Great Britain pound went down after PPI was issued. The analyst predicted that GBP would continue to drop as British government took fiscal austerity and its economic growth was uncertainty.

 

Bank of England predicted that GBP/USD would increase to 1.5300 in one month, and GBP/USD might rise to 1.4700 in three months.

[Korean Won Declined Sharply As Its Interest Rate Was Kept Unchanged]

Korean won went down sharply in the Asian forex market today as Bank of Korea made a determination that it would keep interest rate unchanged. Meanwhile, Korean won weakened as foreign investors sold a lot of Korean bonds.

 

The forex rate of US dollar against Korean won traded at 1,128.60 won today, which increased 11.60 won. Japanese yen versus Korean won was 13.5178 won, which declined 0.0101 won.

 

Bank of Korea kept interest rate unchanged at 2.75%, though Korean government required to reduce the inflationary pressure.

 

Bank of Korea predicted that GDP in Korea would increase by 4.5% in 2011. Moreover, Kim Choong-soo, president from Bank of Korea, said that its economic growth might much more than expectation.

[USD Went Down,FED Might Keep Monetary Policy Unchanged]

USD versus Japanese yen trade near to 82.25 yen yesterday(Jan.9,2011). US dollar index went down to the intraday low of 77.63. Bernanke, president of Federal Reserve, said that US unemployment rate was still high though the non-farm unemployment rate decreased obviously on December. The analysts pointed out that Federal Reserve might keep monetary policy unchanged recently.

 

Great Britain pound against US dollar went down in the forex market as British trade deficit expanded unexpectedly and forex investors increased their expectation for the rising of interest rate by Bank of England. At the same time, European stock market and American stock market declined narrowly. The investors increased their demand for GBP.

GBP/USD traded at 1.6091/95 as of 9:44 Beijing time today.

[US Dollar Weakened on This Week]

The US dollar index continued to decline to 77 basis points on this week.

 

The forex rate of US dollar against Euro dropped from 1.36 dollars to 1.37 dollars. The rising of Euro was very strong, which reached to the two-month record high level. The forex price of US dollar against Japanese yen was in the consolidation range of 82 yen. USD versus Great Britain pound traded near to 1.59 dollars, which was very stable. USD/CHF traded at 0.94; USD/CAD was 0.99 dollars. AUD/USD might go up in the forex marke. The forex rate of USD versus New Zealand dollar traded at 0.76 dollars in the forex market.