Russian Ruble Appreciates Despite Central Bank Intervention

The Russian continued to rise against the US dollar and stabilized against the euro today, following the exceptional intervention measures conducted by the central bank.

Bank Rosii (the country’s central bank) released Russia’s International Reserves statistics for the past week today, showing an increase of $5.1 billion up to $517.9 billion. It’s said by the market analysts from the Russian Otkritie financial corporation that about $1.9 of that gain was purchased by the bank to hold down the appreciation of the national currency, which often occurs during the last weeks of the month because the exporters have to pay taxes during that time.

Dollar Falls Farther Against Euro on Stock Market Rally

US  DollarThe  US  dollar  is  declining  all  other  major  currencies  except  the  Great  Britain  pound  as  the  consumer  optimism  rises  better  than  expected  and  the  US  stock  market  rallies.

The  greenback  fell  for  the  sixth  day  in  a  row  against  the  single  European  currency  today  and  posted  a  fifth  negative  daily  result  against  the  Japanese  yen,  while  standing  strong  against  the  pound  sterling  for  the  third  day.  Ironically,  the  main  trigger  for  the  dollar  losses  today  was  the  positive  consumer  confidence  report  from  The  Conference  Board  that  showed  a  reading  of  65.4  for  April.

As  a  result,  the  US  stock  market  rallied  today,  reducing  appeal  for  the  ”safe  haven”  dollar.  Dow  Jones  Industrial  Average  index  added  0.96  percent.  While  many  currencies  are  positively  correlated  with  their  respective  stock  markets,  the  US  dollar  usually  reacts  negatively  to  gains  in  equity.

Swiss Franc Sets New Records on Continued Positive Sentiment

The  Swiss  currency  reached  a  new  all-time  record  against  the  US  dollar  and  did  well  against  the  other  major  currency  pairs  today,  as  the  market  participants  continued  to  base  their  positions  on  the  positive  monthly  outlook  report  released  earlier  by  the  central  bank  of  Switzerland.

The  franc  rose  against  the  US  dollar,  breaking  the  record  high  level  set  on  April  21  —  the  USD/CHF  pair  is  in  a  constant  bearish  wave  since  June  2010.  The  Swiss  franc  also  gained  against  the  euro,  following  3  days  of  rather  directionless  trading,  and  also  outperformed  the  Japanese  yen  today.  Traders  are  reacting  to  speculations  that  the  country’s  monetary  policy  may  be  tightened  soon.

Pound Strives Higher as UK Retail Sales Expand

The  Great  Britain  pound  advanced  after  the  report  showed  that  the  retail  sales  in  Britain  unexpectedly  rose  last  month,  refueling  talks  about  possible  increase  of  the  interest  rates  by  the  central  bank.

The  UK  retail  sales  increased  by  0.2  percent  in  March  on  month-on-month  basis,  following  the  drop  by  0.9  percent  in  February.  This  report  surprised  analysts,  who  expected  a  decrease  by  0.5  percent.  The  public  net  borrowing  was  £18.6  billion,  in  line  with  forecasts.

Aussie Jumps to New Record on Higher Export & Import Prices

The  Australian  dollar  surged  after  the  report  showed  that  that  the  export  and  import  prices  rose  in  the  first  quarter  of  2011,  signaling  that  the  economic  recovery  gains  momentum.

The  Australian  export  prices  surged  5.2  in  the  three  month  through  March  this  year.  The  import  prices  rose  1.4  percent,  following  the  drop  by  3.8  percent  in  the  previous  quarter.  The  expected  growth  of  the  import  prices  was  0.8  percent.

Franc Gains vs. Euro, Drops vs. Yen & Dollar on Safety Demand

Worries  about  the  European  debt  crisis  and  the  prospect  of  US  credit  rating’s  downgrade  increased  demand  for  safe  currencies  today.  As  a  result,  the  Swiss  franc  advanced  versus  the  euro,  but  demand  for  safety  benefited  more  for  the  US  dollar  and  the  Japanese  yen.

Finland’s  Justice  Ministry  reported  that  support  of  the  True  Finns  reached  19  percent.  The  party’s  leader  Timo  Soini  says  that  Finland’s  taxpayers  shouldn’t  have  paid  for  aid  to  Greece  or  Ireland.  If  his  party  would  win,  Finland  may  block  the  bailout  for  Portugal  as  approval  of  all  the  nations  of  the  European  Union  is  required  to  authorize  the  decision.  Greece’s  Finance  Minister  George  Papaconstantinou  stated  that  restructuring  of  Greece’s  debt  wasn’t  considered  and  EU  spokeswoman  Chantal  Hughes  confirmed  these  claims.

Aussie Ends Week Flat vs. Greenback & Euro

The  Australian  currency  fell  against  the  Japanese  yen  over  the  week  on  concerns  about  Europe’s  debt  problems  and  China’s  possible  austerity  measures.  The  Aussie  managed  to  erase  losses  versus  the  euro  and  the  US  currency  on  the  signs  of  the  global  growth  and  increasing  commodity  prices.

China,  the  biggest  trading  partner  of  Australia,  still  attempts  to  cool  its  overheating  economy,  but  such  attempt  remain  without  success  so  far.  The  accelerating  inflation  spurred  talks  that  the  Chinese  government  will  perform  additional  tightening,  and  that  would  be  bad  for  Australia’s  economy.  Fears  of  the  debt  crisis  continue  to  plague  the  European  Union,  reducing  demand  for  higher-yielding  assets.  The  downgrade  of  Ireland’s  debt  rating  by  Moody’s  Investor  Service  increased  these  worries.

Pound Gains as UK Consumer Confidence Improves

The  Great  Britain  pound  jumped  today  after  the  report  showed  the  improvement  of  the  UK  consumers’  confidence,  encouraging  analysts  to  talk  about  a  possible  increase  of  the  lending  rates  by  the  nation’s  central  bank.

The  Nationwide  report  about  Britain’s  consumer  confidence  showed  that  the  confidence  index  increased  from  39  in  February  to  44  in  March.  That’s  compared  to  the  median  forecast  of  40.  The  report  said  that  the  consumers’  “assessments  of  their  present  situation  remain  subdued”.

Loonie Falls as BOC Keeps Main Rate Unchanged

The Canadian dollar slid after Canada’s central bank left its key interest rate unchanged and on concerns that strong currency may harm the nation’s economic growth. Currently the currency rose a little and moves sideway versus the euro and the US dollar.

The Bank of Canada left its overnight rate at 1 percent, as was expected by Forex market participants. The Bank explained its concerns about the strong currency in the statement:

Euro Spurred by ECB Rates Hike This Week

The euro fluctuated this week, behaving differently against different currencies, but by the end of the week the currency surged as the European Central Bank increased its main interest rate. Still, the shared European currency posted weekly losses against some stronger currencies.

The anticipated raise of the interest rates occurred and that boosted the euro in the near-term. In the longer-term doubts about ability of the European economy to survive with higher borrowing costs remain. It’s true that the major economies of the European Union, especially Germany, show strong economic growth. But the peripheral nations already face many difficulties and higher lending rates may worsen the situation. ECB President Jean-Claude Trichet attempted to ease such concerns in his speech at press-conference after the rates hike, saying:

Yen Climbs After Another Earthquake, Rates Stays Unchanged

The Japanese yen rose today on the speculation that demand from investors will shift to safe currencies from higher-yielding ones after Japan was hit by another earthquake.

Today Japan experienced yet another earthquake. The 7.1-magnitude tremor is the strongest since the earthquake on March 11 and caused the tsunami warning. Tokyo Electric Power Co. reported that the new earthquake hasn’t influenced the Fukushima nuclear power plant that was damaged by the previous earthquake. Still, this quake can switch mood among investors to risk aversion mode.

Swiss Franc Boosted by Surge of Inflation

The Swiss franc jumped against 14 of 16 most-traded currencies after the report showed that the rate of inflation growth in Switzerland unexpectedly increased in March.

The Federal Statistical Office reported the consumer prices grew 0.6 percent in March instead of expected 0.2 percent, following the advance by 0.4 percent in February. The report by SECO on April 8 is expected to show that the unemployment rate in Switzerland decrease slightly. Swiss National Bank board member Jean-Pierre Danthine said that an interest rates hike by the European Central Bank could provide a leeway for Switzerland in planning its own policy.

Australian Dollar Recovers After Losses on RBA Statement

The Australian dollar fell yesterday against the US dollar and the euro as the Reserve Bank of Australia kept its benchmark interest rate unchanged and the trade balance posted an unexpected deficit. The Aussie currently recovered against the greenback and attempts to rise against the euro, the currency also gained versus the Japanese yen.

The RBA decided yesterday to keep its cash rate unchanged at 4.75 percent, in line with the expectations of analysts. Bank’s Governor Glenn Stevens stated that the strong currency helped to control the inflation, reducing need for an increase of the interest rates. Stevens said in the statement: