By world market pulse team on October 14,2010
Strident remarks by Germany's Bundesbank president Axel Weber calling on the ECB to stop its government bond purchases has reopened the debate on whether bonds have been ineffective in easing strains in financial markets. Analysts have mentioned the case of Greek Bond yields that fell some 13 percent in Q3 after the program was initiated in response to that country’s crisis in May, it is hard to argue against the perceived benefits. What makes the statement more critical is that Axel Weber is considered as a prime candidate to the European Central Bank's top job, coming open next October.
Bullish Euro: Meanwhile a reading of the FOMC minutes has showed that a majority of the Committee members favor additional monetary accommodation even without the US economic outlook worsening which could mean the euro remains higher while the US dollar slips lower.
Traders are likely to remain in a Euro Bullish mode despite the firming up of the US dollar yesterday on what market participants describe as a wariness of any further intervention by the BoJ, and the increasing’ uncertainty over the size and timing of a much anticipated round of stimulus by the Fed.
USD: The movement in the dollar index however has a lot of effect on commodities and other currencies, even if it does not replicate the action of the index but the USD needs some sort of a trigger mechanism to come out of its negative sluggish cycle. Some of the points that can trigger the positive spike in the Dollar index are discussed here.
Fed Public Debate Grows: Meanwhile, the Fed’s members continued a very public debate of the central bank’s policy, with Kansas City President Hoenig stating that QE could do more harm than good while the newly appointed Fed Vice President Yellen voiced her concern about extraordinary low rates, saying they may motivate investors to ‘reach for yield’ by engaging in excessive risk-taking. If the public Fed debates are to be considered as the yardstick for future policies, its given the impression that Fed indeed has lot many options up its sleeve but there is a growing market view that Fed would not utilize any other choice and hold the rates near zero and to try to implement further accommodative measures simultaneously.
In FX markets, the mere thought that the Fed was considering adding more liquidity via QE was sufficient to weaken the dollar by 5.5% from mid-September to early October against its trade weighted currency basket and by over 9% against the euro.
Euro ETFs To Watch Out For:
Rydex CurrencyShares Euro Currency Trust (FXE): The EUR/USD exchange rate is a foreign exchange spot rate that measures the relative values of two currencies, the euro and the U.S. dollar.
FXE Tracks: Euro Index. Expense Ratio: 0.40%
Short Euro ETFs
ProShares UltraShort Euro (EUO): ProShares UltraShort Euro seeks daily investment results, before fees and expenses, that correspond to twice (200%) the inverse (opposite) of the daily performance of the U.S. Dollar price of the Euro.
EUO Tracks: Euro (-200%) Index. Expense Ratio: 0.95%
Market Vectors-Double Short Euro ETN (DRR): As the Index is two-times leveraged, for every 1% weakening of the euro relative to the U.S. dollar, the level of the Index will generally increase by 2%, while for every 1% strengthening of the euro relative to the U.S. dollar, the Index will generally decrease by 2%.
DRR Tracks: Double Short Euro Index. Expense Ratio: 0.65%
Long Euro ETFs
ProShares Ultra Euro (ULE): ProShares Ultra Euro seeks daily investment results, before fees and expenses, that correspond to twice (200%) the U.S. Dollar price of the Euro.
ULE Tracks: Euro (200%) Index. Expense Ratio: 0.95%
Market Vectors-Double Long Euro ETN (URR): As the Index is two-times leveraged, for every 1% strengthening of the euro relative to the U.S. dollar, the level of the Index will generally increase by 2%, while for every 1% weakening of the euro relative to the U.S. dollar, the Index will generally decrease by 2%.
URR Tracks: Double Long Euro Index. Expense Ratio: 0.65%
For More World Market Pulse ETFs stocks futures commodities forex indicators forecast http://worldmarketpulse.com/
Bullish Euro: Meanwhile a reading of the FOMC minutes has showed that a majority of the Committee members favor additional monetary accommodation even without the US economic outlook worsening which could mean the euro remains higher while the US dollar slips lower.
Traders are likely to remain in a Euro Bullish mode despite the firming up of the US dollar yesterday on what market participants describe as a wariness of any further intervention by the BoJ, and the increasing’ uncertainty over the size and timing of a much anticipated round of stimulus by the Fed.
USD: The movement in the dollar index however has a lot of effect on commodities and other currencies, even if it does not replicate the action of the index but the USD needs some sort of a trigger mechanism to come out of its negative sluggish cycle. Some of the points that can trigger the positive spike in the Dollar index are discussed here.
Fed Public Debate Grows: Meanwhile, the Fed’s members continued a very public debate of the central bank’s policy, with Kansas City President Hoenig stating that QE could do more harm than good while the newly appointed Fed Vice President Yellen voiced her concern about extraordinary low rates, saying they may motivate investors to ‘reach for yield’ by engaging in excessive risk-taking. If the public Fed debates are to be considered as the yardstick for future policies, its given the impression that Fed indeed has lot many options up its sleeve but there is a growing market view that Fed would not utilize any other choice and hold the rates near zero and to try to implement further accommodative measures simultaneously.
In FX markets, the mere thought that the Fed was considering adding more liquidity via QE was sufficient to weaken the dollar by 5.5% from mid-September to early October against its trade weighted currency basket and by over 9% against the euro.
Euro ETFs To Watch Out For:
Rydex CurrencyShares Euro Currency Trust (FXE): The EUR/USD exchange rate is a foreign exchange spot rate that measures the relative values of two currencies, the euro and the U.S. dollar.
FXE Tracks: Euro Index. Expense Ratio: 0.40%
Short Euro ETFs
ProShares UltraShort Euro (EUO): ProShares UltraShort Euro seeks daily investment results, before fees and expenses, that correspond to twice (200%) the inverse (opposite) of the daily performance of the U.S. Dollar price of the Euro.
EUO Tracks: Euro (-200%) Index. Expense Ratio: 0.95%
Market Vectors-Double Short Euro ETN (DRR): As the Index is two-times leveraged, for every 1% weakening of the euro relative to the U.S. dollar, the level of the Index will generally increase by 2%, while for every 1% strengthening of the euro relative to the U.S. dollar, the Index will generally decrease by 2%.
DRR Tracks: Double Short Euro Index. Expense Ratio: 0.65%
Long Euro ETFs
ProShares Ultra Euro (ULE): ProShares Ultra Euro seeks daily investment results, before fees and expenses, that correspond to twice (200%) the U.S. Dollar price of the Euro.
ULE Tracks: Euro (200%) Index. Expense Ratio: 0.95%
Market Vectors-Double Long Euro ETN (URR): As the Index is two-times leveraged, for every 1% strengthening of the euro relative to the U.S. dollar, the level of the Index will generally increase by 2%, while for every 1% weakening of the euro relative to the U.S. dollar, the Index will generally decrease by 2%.
URR Tracks: Double Long Euro Index. Expense Ratio: 0.65%
For More World Market Pulse ETFs stocks futures commodities forex indicators forecast http://worldmarketpulse.com/
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