Archive For "June, 2010"

The dollar and the Japanese yen extend gains after an index on consumer confidence falls to the lowest level since March, adding to investors’ desire of safe havens amid worries over global growth prospects.

WASHINGTON (MarketWatch) — The best guess of experts at the International Monetary Fund is that the global economic recovery will continue in an uneven fashion, said Dominique Strauss-Kahn, the head of the IMF on Tuesday. “The recovery will go on without a double-dip,” Strauss-Kahn said in a question-and-answer session following a speech at the Peterson Institute for International Economics. Strauss-Kahn said there were certainly downside risks facing the recovery and many possible triggers of a downturn, but the baseline IMF forecast saw sustained growth. Strauss-Kahn defended the G-20′s emphasis at its summit in Toronto on deficit reduction, saying that every country must tighten its belt at some point. Strauss-Kahn said the risk that a weaker euro would lead to large European trade surpluses was not a big threat to the global economy.

Home prices rise 0.8% in April compared with March in 20 major U.S. cities, according to the Case-Shiller home price index released by Standard & Poor’s.

WASHINGTON (MarketWatch) — The Federal Reserve said Tuesday that its $2 billion auction of 28-day term deposits through its Term Deposit Facility came at a rate of 0.27%. It received bids for 5.57 times the amount it accepted at the auction on Monday. Term deposits, designed like certificates of deposits, are a tool to soak up, or immobilize, excess bank reserves as a precursor to being able to raise interest rates. The size of the auctions will have to be much larger in scale to work effectively, economists noted. Banks have over $1 trillion in excess reserves. The Fed has scheduled one more auction for a longer time period, but has not announced an amount.

Stocks in Europe on Tuesday slumped in the worst single-day decline in more than a month, on fears about the strength of the economies of the U.S. and China as well as the health of the European banking sector.

The looming due date for repayment of the European Central Bank’s 442 billion euro ($543 billion) in one-year loans to banks is stoking renewed fears over liquidity in the 16-nation euro zone.

The dollar and the yen gain amid worries over growth prospects, with a particular focus on China, as well as concerns about the health of European banks.

NEW YORK (MarketWatch) — Treasury prices and the dollar added to gains on Tuesday after the Conference Board’s consumer confidence index plummeted to 52.9 in June – the lowest level since March — from a downwardly revised 62.7 in May. Yields on 10-year notes , which move inversely to prices, fell 5 basis points to 2.97%, having touched the lowest since April 2009. The euro [c: cur_eurusd] fell to $1.2161, down from $1.2292 in North American trade late Monday. The dollar index , which tracks the U.S. unit against six major counterparts, rose to 86.251, up from 85.620.

Stocks in Europe slumped on Tuesday, picking up from Asia the fears over economic growth just days after world leaders pledged to rein in deficit spending.

The dollar and the yen gain on rival currencies in safe-haven action in the foreign-exchange market. The catalsyts: worries over growth prospects, with a particular focus on China, as well as concerns about the health of European banks.