ESM, EFSF Approve Waiver Of Greece's Mandatory Early Loan Repayment

Trading 28 oct 2019 Commentaire »

Greece does not have to meet a mandatory repayment obligation to EU to make a partial early repayment of a loan from the International Monetary Fund, the European Stability Mechanism, or ESM, said in a statement on Monday.

"The Boards of Directors of the European Stability Mechanism (ESM) and European Financial Stability Facility (EFSF) agreed today to waive the mandatory repayment obligation of ESM/EFSF loans in connection with a partial early repayment by Greece to the International Monetary Fund (IMF)," the ESM said.

In September, Greece revealed that it intends to repay early nearly EUR 2.7 billion of its outstanding loans to the IMF.

The country had agreed with the ESM and the EFSF while securing bailouts during crisis times that in the event of an early repayment to the IMF, a proportional amount of the financial assistance should be repaid to both EU facilities. Without the waiver approved on Monday, Greece would have been obliged to make a cumulative repayment of EUR 52.2 billion to the ESM and EFSF in parallel to its IMF repayment, the ESM said.

"It will generate savings as Greece can now finance itself on the market at a lower cost compared to the cost of servicing the tranche to be repaid to the IMF," ESM Managing Director and EFSF CEO Klaus Regling said. "This will improve Greece's debt sustainability and should be positively perceived by financial markets."

These benefits can materialize only if the ESM and EFSF waive their early repayment rights, and these will improve the EFSF's and ESM's position as Greece's main creditors, Regling added.


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Swiss Franc Falls On Trade Optimism

Trading 28 oct 2019 Commentaire »

The Swiss franc declined against its major counterparts in the European session on Monday, as hopes of the U.S. and China finalizing "phase one" trade deal underpinned risk sentiment.

The Office of the U.S. Trade Representative said in a statement that the countries have "made headway on specific issues and the two sides are close to finalizing some sections of the agreement."

On Saturday, China's Commerce Ministry said both sides are "close to finalizing" some parts of a trade agreement after high-level telephone discussions on Friday.

U.S. President Donald Trump said he hopes to sign the deal with China's President Xi Jinping next month at a summit in Chile.

On the Brexit front, the European Union has agreed for a Brexit extension until January 31, 2020, removing the risk of a damaging no-deal split on Thursday.

The currency showed mixed trading against its major counterparts in the previous session. While it was steady against the pound and the yen, it dropped against the greenback and the euro.

The franc dropped to near a 2-week low of 109.14 against the yen, from a high of 109.38 hit at 5:00 pm ET. The franc is seen finding support around the 108.00 region.

Data from the Bank of Japan showed that Japan producer prices rose 0.5 percent on year in September - in line with expectations and unchanged from the August reading following a downward revision from 0.6 percent.

On a monthly basis, producer prices were flat following the 0.1 percent decline in the previous month.

The Swiss currency depreciated to 0.9970 against the greenback, its weakest since October 16. The next likely support for the franc is seen around the 1.01 level.

The franc that ended Friday's trading at 1.1017 against the euro fell to near a 2-week low of 1.1057. On the downside, 1.13 is possibly seen as the next support level for the franc.

Data from Destatis showed that German import prices decreased at a slower than expected pace in September.

Import prices dropped 2.5 percent year-on-year in September, following a 2.7 percent fall in August. This was slower than the 3 percent decline economists had expected.

After rising to 1.2739 against the pound at 5:00 pm ET, the franc eased off to a 4-day low of 1.2809. The franc is poised to challenge support around the 1.31 level. The latest Distributive Trends Survey from the Confederation of British Industry showed that the UK retail sales volume declined for the sixth consecutive month in October and retailers' stock levels in relation to expected sales reached a record high.

The retail sales balance fell to -10 percent in October. Retailers expect sales volume to rise marginally next month with a balance of 1 percent forecasting sales growth.


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EURUSD bulls step in at the last minute….

Trading 28 oct 2019 Commentaire »

EURUSD is bouncing off the 1.1070 support area and the line in the sand for our bullish scenario. Bulls have stepped in and are pushing price higher. But nothing is clear yet. There is lots of work to be done by bulls and first to recapture 1.1130.

analytics5db7337657fa2.png

Black line - support trend line

Red line -RSI resistance

EURUSD is bouncing towards 1.11. The RSI is still below the resistance trend line. This tells me that bulls are not out of danger yet. Bulls need to continue moving higher and recapture the short-term resistance at 1.1130. If the RSI resistance breaks to the upside this would support at least the short-term bullish trend. Support remains key at 1.1060-1.1070. This is our line in the sand. Below this level we turn bearish.

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Gold reverses below $1,500 as our bearish warning is confirmed

Trading 28 oct 2019 Commentaire »

In our last analysis we noted the bearish reversal signal we got by the hammer candlestick pattern in the Daily chart. The rejection at $1,520 confirmed the importance of the resistance above $1,520 and confirmed the strength of bears.

analytics5db731fcea980.png

Orange area -resistance

Black line -trend line resistance

Gold price got rejected at the orange resistance area. The RSI got rejected at the resistance trend line again. The daily bearish hammer pattern that we noted has a bearish follow through confirming our worries. Price is back below $1,500 and if support at $1,490 fails to hold, we could see Gold price move towards $1,450-60 in early November. Resistance remains key at $1,520-25. We remain bearish as long as price is below that level.

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Argentina Cuts Dollar Purchase Limit For Individuals

Trading 28 oct 2019 Commentaire »

Argentina's central bank on early Monday sharply cut the dollar purchase limit for individuals after the opposition leader Alberto Fernandez won the presidential election.

The central bank announced that it will limit the dollar purchases by individuals to $200 per month versus $10,000 earlier.

Over the last few days, a significant increase in demand for dollars, mainly by individuals, was observed, Banco Central De La Republica Argentina, or BCRA, President Guido Sandleris said.

The central bank saw the risk of this trend continuing this week and hence decided to tighten the controls, Sandleris added.

With the latest move, the BCRA aims to preserve the foreign reserves during the government transition period.

The reduction exclusively applies to the purchase of dollars for treasury and financial speculation and will not affect access to dollars for foreign trade or debt payments, the bank said.


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Hong Kong Likely To Face Recession, Chan Says

Trading 28 oct 2019 Commentaire »

Hong Kong is likely to face a recession this year as the economy is burdened by ongoing domestic protests, Financial Secretary Paul Chan said in a blog post.

It is extremely difficult to achieve the forecast of 0 to 1 percent economic growth this year, he wrote.

"It is impossible to rule out the possibility that the economy will experience negative growth throughout the year," he said.

The official third quarter GDP data is due on Thursday. A technical recession is defined as two consecutive quarters of contraction.

Early this month, Chief Executive Carrie Lam said the economy has already slipped into a technical recession.


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NZ Dollar Falls Against Majors

Trading 28 oct 2019 Commentaire »

Reversing direction, the New Zealand dollar slipped against its major counterparts in the European session on Monday.

The kiwi declined to near 2-week lows of 0.6341 against the greenback and 1.0765 against the aussie, from its early highs of 0.6360 and 1.0726, respectively.

The kiwi eased off from its early highs of 1.7422 against the euro and 69.14 versus the yen and fell to a weekly low of 1.7502 and a 10-day low of 68.95, respectively.

The currency is likely to find support around 0.62 against the greenback, 1.09 against the aussie, 1.78 against the euro and 67.00 versus the yen.


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*NZ Dollar Declines To Weekly Low Of 1.7502 Against Euro

Trading 28 oct 2019 Commentaire »

NZ Dollar Declines To Weekly Low Of 1.7502 Against Euro


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*NZ Dollar Falls To 10-day Low Of 68.95 Against Yen

Trading 28 oct 2019 Commentaire »

NZ Dollar Falls To 10-day Low Of 68.95 Against Yen


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*NZ Dollar Slides To Near 2-week Low Of 0.6341 Against U.S. Dollar

Trading 28 oct 2019 Commentaire »

NZ Dollar Slides To Near 2-week Low Of 0.6341 Against U.S. Dollar


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