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Ashraf's appearance on CNBC discussing the re-emerging debt concerns of the P-I-I-G-S. http://bit.ly/aYcG8k GBPUSD has yet to close above the $1.5520 trendline resistance, trading around the 55 and 200-day MAs. $EURUSD proved underpinned at $1.2660s, which is the Aug 24 trendline support....

YEN STILL DOING IT as the mere sign of profit-taking in global bourses, sends yen crosses falling across the board. AUDJPY proved once again unable to break the trendline resistance of 77.70s, extending from the June 21 high. And with AUDJPY Daily stochastics showing a negative cross-over, prelim...

STERLING BROADENS WEAKNESS on fresh data disappointment, this time from the slowest monthly rise in Nationwide house price index since Nov 2009 and slower than expected Aug construction PMI (6-month low). GBPUSD drifts around its 200-day MA $1.5427, while attempting to hold above the $1.5390s38%...

STERLING's NEW BOE REALITY. The underlining negative of the British pound continues to be the Bank of Englands insistence that inflationary pressure remain temporary, as well as the emergence of BoEs new MP member, Martin Weale, whose double-dip forecasts for UK reduced expectations of a 2010 rate...

US Q2 GDP REVISED down to 1.6% (vs. exp 1.4%) from advanced 2.4% reading, triggering a relief rally in equities and BROAD YEN SELLOFF, especially since the Japanese currency has been already hit by: i) fresh political fallout in Japan and ; ii) escalating signals of a looming stimulus package...

GDPs, BERNANKE & CONSUMER SENTIMENT: UK Q2 GDP (4:30 EST, 8:30 am GMT, 9:30 BST) is expected to remain unrevised at 1.1% (the highest rise in 4 years), but any downward revision will likely ease cable into the $1.5570s.========= US Q2 GDP (8:30 EST, 12:30 GMT) seen revised to 1.3% from the advance...

JOBLESS CLAIMS GOOD ENOUGH FOR FURTEHR USD WEAKNESS, +473K, which is good enough for risk appetite to improve, but since the overall continue to show clear uptrend, USD to remain on the backfoot. YEN WEAKNESS suggests 80.60s in CADJPY, NZDJPY eyes 60.20. GBPUSD rebound accumulated fresh bids in...

CANADA JUL CPI is the only data item of the day, further inflation softening could add to CAD selling especially in the event of prolonged declines in appetite. Watch the annual core CPI (exp at 1.8% from 1.7%). USDCAD 3-hr shows immediate TL resistance at 1.0420, a break of which seen extending...

DATA DOUBLE PUNCH HITS MARKETS as US jobless claims jump by 500K (highest since Nov), Aug Philly Fed -7.7 (lowest since Jul 2009) put life back in the yen as risk aversion intensifies (S&P500 -1.6% testing 1075). USDJPY testing 84.80, AUDJPY eyes 75.50, EURCHF loses 200 pips now testing 1.3180...

STERLING RALLIED immediately after the BoE minutes showed Andrew Sentence continued to call for a 25-bp rate hike. While this was no real surprise, some players thought that perhaps Sentence would not dissent considering the emerging slowdown in inflation across the G7. Considering yesterdays...

WATCH BoE MINUTES: Wednesdays release of the minutes from the August MPC meeting could add to GBP losses. The currency has been hit hard after Tuesdays unexpectedly weak July CPI (see earlier IMT for detail). The inflation story is a big deal. For the past 4 months, strong UK inflation was the...

GBPUSD RESTS RIGHT ON THE 2-month trend line support at $1.5565-70, following the all-important July inflation figures (see prev IMT). This is the GBPUSD equivalent of last weeks EURUSD trendline support, which held up at $1.3740s. GBPUSD does remain above its 200-day MA ($1.55), but has yet to...

DUBIOUS BOUNCE IN SENTIMENT following strong Q2 GDP figures in Eurozone (1.7% q/q) and Germany (2.2%) has weighed on USD and JPY but both currencies are now off their lows as markets remain cautious ahead of US Jul retail sales and consumer sentiment. S&P500 yesterday closed below its 55-day MA...

GBP & JPY are at opposite ends as sterling is the biggest loser in todays FX market flows following an unexpected decline in UK July RICS (House Price balance) to -8 from +9, the 1st negative index since July (and lowest since April 2009). JPY gains on slower than expected Chinese exports growth...

USDX 3-month LIBOR continues to deteriorate; todays fixing drops to 0.418% vs. 0.52% 2 weeks ago, while EUR-3 month LIBOR rises to 0.832% from 0.75 in mid July. This is leading to an ever widening spread in favour of the EUR reaching +41 bps. This weeks article on EURIBOR, Euro & USD Index...

YEN TAKES OVER as stocks retreat across the board and especially by the fact that markets are paying less attention to Japanese policy makers who indicate that theyre closely watching currency yen movements. FALLING BOND YIELDS are also helping to boost the yen as the US 2-year yield hit a new...

GBP NET SHORTS against USD fell to 17,940 contracts, the lowest level since August of last year. The chart http://chart.ly/7fxh7s shows GBPUSD is closely correlated with futures speculators interest in GBPUSD. This months BoE inflation report maybe the only viable barrier to further GBP gains in...

GBPAUD reflects contrasting expectations . . . for the RBA and BoE, with the former expected to keep rates on hold due to softer than expected inflation and the latter seeing better reasons to listen...

INSTEAD OF ONLY FOCUSING ON THE USUAL JPY and USD pairs, consider the ensuing moves in EURAUD, GBPAUD and GBPUSD. EURAUD on course for taking out 1.4570s, eyeing preliminary upside at 1.4670s, before key resistance at 1.4940-50. GBPAUD attempts to break above the 1.7390 trend line resistance...

US Consumer confidence fell 4 pts in July, but remains above 50, which may sustain major equity indices above their 200-day MAs. GBPUSD touches its 200-day MA for the 1st time since January, with momentum remaining positive for a retest of $1.5580 and $1.5620. EURUSD 4-hr run the risk of calling...

MIXED FORECASTS for todays June new home sales report from the US, with some economists expecting a rise to 320K from 300K, while others seeing 280K. Although the May report showed a 32.7% plunge to 300K, we may yet see another decline, in which case could exacerbate the existing decline in USDJPY...

YEN RALLIES across the board, unwinding some of last weeks losses; USDJPY fails to break 87.70 50% retracement of the 89.13-86.28 decline, now eyeing 86.80 prelim support; US June new home sales. CADJPY continues to turn the corner, eyeing 83.40s from the current 84.00s after having failed the...

7 of the 91 banks failed the Eurozone Stress Tests, whose scenarios included: -0.3% in 2010 and 2011 GDP, a double-dip recession, 20% decline in stock markets in 2010-11 and a 4-notch credit ratings downgrade of Eurozone securitized products. LISTEN TO ASHRAF's INTERVIEW discussing the Stress...

Ashraf's Reaction to the Just-released Stress Test Methodology on Reuters TV http://link.reuters.com/syb39m US-GERMAN 10 yr spread down to 25 bps, New 9-month low.. remember the 1st chart in this article http://bit.ly/akoJbs $$. GBPUSD seen regaining 1.5480-90 before mid of next week. ......

UK Q2 GDP KNOCKS IT OUT OF THE PARK, rising 1.1% q/q vs. expected +0.5%, and +1/6% y/y vs. exp +1.1%. This is the first annual rise in 8 quarters. Services sector rose 0.9% q/q highest since Q1 2007. Although the FTSE-100 is up only 2 pts, there is sufficient risk appetite (from Asia) to boost...

UK GDP FIGURES: Due at 8:30 am GMT (9:30 BST) The preliminary figure of UK Q2 GDP expected +0.5% q/q from +0.3% in Q1, which is the 3rd straight quarterly positive GDP growth. On a y/y basis, Q2 GDP exp +1.1% from 0.2%, the 1st positive y/y figure in 8 quarters. Positive figures could further...

EURUSD BREAKS above $1.29, regaining the 100-day MA for the first time since December mainly on a weakening US dollar and good news on the earnings front. Euros momentum shows the elements of an extenstion towards $1.3120. US equities made a late session rally on news that Goldman Sachs would...

MIXED US DATA as US June PPI falls 0.5% vs. exp 0.1% decline, Empire State index WORSENS to 5 from 19.6 with broad declines in New Orders and Employment Index. The good news is the 21K decrease in jobless claims to 429K. WATCH US JUNE INDUSTRIAL PRODUCTION (13:15 GMT) which could show the first...

OIL UNABLE TO BREACH ITS 200-day MA of 77.40,which coincides with the trend line resistance extending from the Mar 5 high thru the June 28 high. This also helps explain USDCADs support at the 1.0270 floor and subsequent recovery to 1.0370. Sticking with prior IMTs bearish call on EURGBP eyeing...

MOODYS DOWNGRADED PORTUGAL by 2 notches to A1 with a stable outlook, prompting broad downside pressure on EUR, but the run-up in equities is boosting EUR back towards $1.2570s from its 1.2520s session lows. GBPUSD rallies by full cent despite retreat in June CPI to 3.2% from 3.7%. Cable eyes...