Forex and Gold Daily Report for December 10, 2012

The dollar ended the week higher against the euro on Friday, following the release of stronger-than-expected U.S. employment data but the greenback trimmed gains as markets digested less encouraging details of the jobs report. But the dollar gave up ground against the yen and the euro as the decline in the unemployment rate was attributed to more people dropping out of the labor force.

While,  Gold futures bounced off earlier lows to end Friday’s session mildly higher, as investors digested the release of November’s non-farm payrolls data while continuing to monitor negotiations among U.S. lawmakers to avoid the looming “fiscal cliff” crisis. On the week, gold futures retreated 0.65%, the second consecutive weekly decline.

  • The pair was very steady despite the numerous Australian releases last week. Building Approvals was very weak, but the employment numbers were strong. The RBA cuts interest rates to an even 3.0%, but this move was priced in by the markets.
  • EUR/USD has an exciting week that began with a gradual climb and a sharp downfall, as Draghi dragged down the euro, below last week’s close. Following last week’s  ECB rate decision, president Mario Draghi hinted on a rate cut possibly at their next meeting after reducing ECB’s forecasts for the euro zone’s economy.
  • GBP/USDremained unchanged  as  UK data was uneventful last week, as PMI numbers were close to the estimates. As well, the BOE made no changes to either QE or the key lending rate, and the pound had a very quiet week.
  • Dollar/yenunderwent a second week of consolidation, ending the week almost unchanged.In the US, a strong Non-Farm Payrolls report is probably not enough to convince Ben Bernanke to stop easing.
  • Gold prices rose in US trading hours on Friday amid sentiment that despite a stronger-than-expected November jobs report, the Federal Reserve will stick with its ultra-loose monetary policies.

To download complete report; CLICK:  Forex and Gold Daily Report 10 December 2012

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