April 28th, 2011 12:17:39 GMT.

GDP’s gonna be weak


How do I  know? Ben Bernanke told me. And the rest of the world yesterday in his press conference. Like inflation, the weakness will be transitory.

Economists expect 2% growth in Q1. Traders are probably looking for more like 1.7-1.8%.

Maybe a minor dollar rally on an upside surprise but nothing dramatic.


April 28th, 2011 12:05:45 GMT.

ECB Mersch: To Continue Gradual Exit From Non-Stand Measures


LUXEMBOURG (MNI) – The European Central Bank will continue to
unwind the non-standard measures that it adopted to counter the
financial crisis, ECB Governing Council member Yves Mersch said

Monetary authorities have “very clearly stated” that “all those
non-standard measures…are temporary,” he said at a press conference in
which he presented the Financial Stability Review of the Bank of
Luxembourg, which he heads.

“We are committed to a gradual exit from this type of measures,”
Mersch said. “We will continue this gradual exit at an appropriate pace
in view of the incoming news.”

Mersch noted the “complete separation principle” with regard to
non-standard measures on one hand and monetary policy on the other.

“We have a monetary policy for the Eurozone at large,” he asserted.
“We operate for the whole transmission mechanism within the Eurozone.
The restructuring of banks is not the task or objective of the central

The ECB has “taken certain measures to ensure the proper
functioning of the transmission mechanism within the Eurozone.”

With respect to fiscal consolidation programs undertaken to support
troubled Eurozone member states, Mersch affirmed that “as long as [a
program] is being implemented and being monitored” there is “no reason
to deviate” from the program. He thus implicitly dismissed debt
restructuring as a solution.

“We have our analysis of the measures that have to be taken…and
as long as the program has been approved and is being implemented there
is no reason for us to deviate,” he said.

–Frankfurt bureau tel.: +49-69-720142. Email: frankfurt@marketnews.com

[TOPICS: MT$$$$,M$$EC$,M$$CR$,MGX$$$,M$X$$$]


April 28th, 2011 11:35:45 GMT.

Update:Germany SA Unemployment Falls Below 3 Million In April


–Adds Unemployment Fcasts By Econ Minister To Story Sent At 04:09 EDT

SA Unemployment: -37k (pan-German), -26k (West), -11k (East)

MNI survey median: -40k m/m
MNI survey range: -50k to -20k m/m

FRANKFURT (MNI) – The ranks of the unemployed in Germany declined
for the 14th consecutive month in April, albeit slightly less than most
analysts had expected, the Federal Labour Office reported on Thursday.

The number of persons actively searching for work fell by a
seasonally adjusted 37,000, lowering the overall level to 2.970 million
or 7.1% of labor market.

In unadjusted terms, the jobless rate dropped to 7.3% from 7.6% in
March, reflecting a drop of 32,000 persons to 3.078 million.

Economics Minister Rainer Bruederle said today he expects that
unadjusted unemployment will fall below three million soon. The minister
said he was also convinced that annual average unemployment in 2011 will
be below three million for the first time since 1992.

Job vacancies rose 13,000 in April after having increased by 9,000
in March. Payroll jobs, data for which have a lag of one month, rose
38,000 after +37,000 in February.

The purchasing managers’ index (PMI) signaled further growth of
staffing levels in April at nearly the record pace seen in March,
extending the run of increases to 14 months, as both manufacturing and
services added workers.

Reflecting the robust labour market in the Eurozone’s largest
economy, a European Commission survey noted a decline in jobless fears
in Germany in March.

A GfK consumer sentiment report also pointed to growth in
employment, which, along with the “excellent economic situation,” is
helping to ease employment worries and keep buying propensity at a high

“This gives consumers planning security, particularly for larger
purchases, and is currently preventing a downward slide in the
propensity to buy as a result of rising inflationary pressures,” GfK

— Frankfurt bureau: +49 69 720 142, email: frankfurt@marketnews.com —

[TOPICS: M$G$$$,MAGDS$,M$X$$$,M$XDS$,MT$$$$]


April 28th, 2011 11:15:59 GMT.

ForexLive European Wrap: Greenback surges back!!!


  • BOJ outlook report: Japan economy to remain under strong downward pressure, mainly on output, for time being
  • German March import prices +1.1% m/m, +11.3% y/y, as expected
  • French March consumer spending -0.7% m/m, demonstrably weaker than median forecast of +0.2%
  • German s.a April jobless total -37k to 2.970 mln vs median forecast -30k. Adjusted unemployment rate steady at 7.1%
  • Italy April business confidence falls to 103.0, down from revised 103.5 in March (prev 103.8), weaker than median forecast of 103.8
  • ECB’s Mersch: ECB will continue gradual exit from non-standard measures at appropriate pace
  • Spain’s Santander: Sees bad debts near peak in Spain
  • ECB funding to Greek banks at 90.4 bln end-Feb from 94.4 bln end-Jan
  • ECB’s Costa: Clear that if unemployment goes up, Portuguese bank sector could be susceptible to mortgage sector problems
  • Beijing: U.S. official says told China “deeply concerned” about deterioration in Chinese human rights conditions
  • Britain says withdrawn Royal wedding invitation for Syrian ambassador – Foreign Office

OK OK, maybe I exaggerate a little.  But at least the beleaguered US dollar has had a little reprieve this morning from it’s incessant pounding.

US treasury yields are firmer this morning, which will be providing some much-needed support.

EUR/USD down at 1.4805 from early 1.4865. BIS sold early above 1.4850 getting the ball rolling.  But persistent buying by Asian sovereigns in the 1.4825/30 area lent support for most of the session. Only in late morning trading did stops through 1.4825 get tripped accelerating the sell-off.

More stops seen below 1.4800. Barrier option interest up at 1.4900.

USD/JPY effectively unchanged at 81.70.  BIS reportedly bought around 81.50 lending much-needed support.

Cable down at 1.6645 from early 1.6725.  The release of poor consumer confidence data overnight will have knocked a little of the shine off sterling.  Real money buying slowed but didn’t manage to stop the decline.


April 28th, 2011 10:05:32 GMT.

Germany’s Labor Min: April Unempl Drop No Reason For Euphoria


BERLIN (MNI) – Despite the continuing drop of unemployment in
April, German Labor Minister Ursula von der Leyen warned Thursday
against excessive optimism with respect to future job market

Unemployment declined for the 14th consecutive month in April, the
Federal Labour Office reported earlier today. The number of persons
actively searching for work fell by a seasonally adjusted 37,000,
lowering the overall level to 2.97 million.

Von der Leyen called the labor market development in April “solid,”
but cautioned that there “is no reason for euphoria.”

The Minister pointed to possible risks for Germany from the
sovereign debt crisis in the Eurozone, the upheavals in the Arab world
and the Japanese disasters.

In other remarks, von der Leyen said the upcoming opening of
Germany’s borders to free movement of labour from the new Eastern
European member states of the European Union on May 1 will likely help
partially solve Germany’s problem of a skilled labor shortage.

Germany’s IW economic research institute earlier this week forecast
that roughly 800,000 people from the new EU member states could migrate
to Germany over the next two years.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

[TOPICS: M$G$$$,M$X$$$,MGX$$$]

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