ZuluTrade Blog

Europe, Greek parliament handily passed the 2013 budget legislation...

Market View | Monday, November 12, 2012 3:47 AM GMT

 Good Morning ,

- Asian equity markets are opening the new week somewhat cautiously, though indices in China are once again supported on a relative basis by better than expected economic data. Released over the weekend, October trade balance came in at a near 4-year high, as exports rose at the strongest pace since May while imports largely met expectations. China minister of commerce said the trade data demonstrates a mild improvement, while economists with ANZ and BofA saw the data as proof the economy has bottomed.

-  Commodity currencies were still net gainers on China exports strength. AUD/USD rose over 30 pips to $1.0420, while USD/CAD fell back below the parity level.

- Over in Japan, Q3 preliminary GDP saw the economy dip into contraction for the first time in 5 quarters. Japanese exports continued to be weighed down by the strong yen with a fall of just over 5% - the biggest decline since Q2 of 2011. Private consumption, Japan's biggest GDP component, also moved faster to the downside with a -0.8% decline vs -0.1% prior. Speaking after the data, PM Noda said the latest GDP require a greater sense of urgency, and BOJ Gov Shirakawa pledged to continue the policy of 'powerful monetary easing'. Japanese yen weakened briefly against the greenback to trade above ¥79.50 before paring those losses. AUD/JPY was the biggest mover on the crosses with a 30pip surge above ¥82.80.

- In Europe, Greek parliament handily passed the 2013 budget legislation that was seen as the final local hurdle for Athens to receive the €32B tranche from lenders. This vote was also not as close as the austerity steps enacted last week when the passage came down to 3 votes, as 167 lawmakers voted in favor of the draft. Greek PM Samaras said today's vote assures relief, even though EMU parliaments must still vote to approve the Greek disbursement. German fin min Schaeuble, speaking over the weekend, said "nobody in the eurozone opposes the idea of accepting the payment of the next tranche of aid", but Greece must be able to demonstrate it can meet the attached conditions. EUR/USD firmed slightly following the vote in Athens, reaching $1.2735 session high.

- German Fin Min Schaeuble: The next installment of funds is up to Greek govt This question, you should pit to my Greek colleagues and not to the German finance minister... Nobody in the eurozone opposes the idea of accepting the payment of the next tranche of aid .

- Moody's comments on Japan: 1st monthly current account deficit is Credit Negative

- Moody's: No threat to Australia's AAA rating; Budget miss will not affect rating

- ECB's Weidmann: Reiterates he is still opposed to ECB decision to fund troubled states with bond purchases

- China former PBoC advisor Yu Yongding: China will encounter yuan appreciation pressure; China economy is bottoming out . China Banking Regulator CBRC: Banking system remains healthy and risk is under control; non-performing loan ratio is low at 0.97%

- BOJ Gov Shirakawa: Japan economy is weakening, growth likely to stall; reiterates BoJ to continue to pursue 'powerful monetary easing' .  Fin Min Jojima: Must approve the deficit bill in Nov or bonds cannot be issued - addressing parliament

Have a nice week !

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