Following yesterday’s national holiday a number of EU countries, we now get back to normal and the only news in Europe for this morning was the unemployment rate which came in worse than expected at 9.2% against a forecast of 9.1%. The jobless rate has now reached its highest level in almost a decade with the worst country being Spain with an unemployment rate of 18.1%, a truly horrific figure. Despite this awful figure the euro surged higher against the dollar, once again indicating that the currency markets, like the oil market, are more allied to equities than to any fundamental news at present, making trading extremely difficult. This will undoubtedly change in due course but at the moment it is a fact of trading life and we have to live with it in making our trading decisions and to some extent is almost laughable in the correlation.
Meantime in the US we have pending home sales for release this afternoon which are expected to come in at 0.4% against a previous of 3.2%. This data is generally considered to be a leading indicator and represents the change in the number of homes under contract to be sold but awaiting completion. If the actual is better than forecast this could be good for the US dollar although it is hard to see how at present given that during the housing bubble in the US something like an extra 3m homes were built which are going to have to be absorbed in the normal way, through growth in the population and the economy. Therefore when assessing housing data and statistics we really need to be wary of its use at this point in the economic “recovery” or otherwise.
You can keep up to date with all the latest fundamental news on the economic calendar, latest currency news and live currency charts by simply following the links. I have also included details on an excellent ECN broker.
