Euro hits 2 year highsDecember 27, 2013 Posted by: Pete Karabatos
The Euro hit a two-year high this morning against the USD after ECB Governing Council member Jens Weidmann stated keeping interest rates low may endanger political reforms. Weidmann was quoted by Germany’s Bild newspaper saying low inflation should not be used as justification for loose monetary policy and that there will be a need to raise rates quickly if inflations return. The Euro’s strength has been magnified by illiquid holiday trading. The GBP also hit 2 year highs as a result of increasing home prices and consumer confidence in the country’s economic recovery.
• U.S. 10-year treasury yields rose to the highest levels in two years on strong U.S. economic data and speculation that the Fed will further reduce its bond purchase program in the near term.
• Japanese inflation hit 1.2% year/year, the fastest pace since 2008, and is now close to policymakers’ target.
• U.S. consumer confidence hit a four-month high in November on the heels of an improving labor market and holiday discounts
• Retail sales in Japan were stronger than expected, posting a 4% year/year gain vs. expectations of 3.0%.
• Most Asian currencies fell against the USD this week due to increased demand for dollars amid signs the U.S. economy is improving and from emerging market outflows spurred by the Fed’s tapering.
12/30 USD: Pending Home Sales (Nov)
12/31 USD: S&P CaseShiller Home Prices (Dec)
12/31 USD: Consumer Confidence (Dec)
01/02 EUR: Manufacturing Purchasing Managers’ Index (Dec)
01/02 USD: Initial Jobless Claims (Dec 28)
01/03 GBP: Mortgage Approvals (Nov)
01/03 USD: Vehicle Sales (Dec)
01/06 CAD: Industrial Production (Nov)
01/06 USD: Factory Orders (Nov)
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