Even though this is the week of the Thanksgiving
holiday in the United States (tomorrow, Thursday) and also the last week of the
month, each of which could be expected to contribute to lacklustre trading,
there are a number of events due today that could shake things up just a little
bit.
At 9:30 GMT UK GDP will be announced,
which should provide direction to the pound Sterling which, in our opinion, is
looking for a reason to start to climb again after a relatively prolonged
period of decline against the US dollar, and even against the Euro on occasion.
US durable goods (13:30 GMT) orders
are always watched for their effects on the greenback and Continuing and Initial Jobless Claims
(13:30 also) are a regular market mover. Both the Reuters/Michigan Consumer
Sentiment Index (14:55) and New Home Sales data (15:00) also have the potential
to stir matters.
Somewhat ironically, it is in periods
of slow trading that events such as these can have the biggest impact, as a relatively
low level of buying and selling can have a disproportionate effect on
volatility.
Record
lows in Iron Ore and Aussie dollar
A report on Bloomberg earlier
in the week was fairly confident that the price of Iron Ore, so important
still to the Australian economy and the fate of the Aussie dollar, would find a
floor at US$70 per tonne. All kinds of things are supposed to happen at this
nice round figure, from the closure of smaller, less-economically viable mines
to opportunistic buying by Chinese steel producers.
It was not to be and last night the
hard commodity fell through the $70 level. At the end of commodity trading
yesterday, benchmark Iron Ore for delivery to the port of Tianjin in China was
trading at $US68.60 per tonne, down 2% from the previous level which was, in
fact, US$70.00.
And right on cue, the Aussie dollar
also broke through to lows that have not been seen since July of 2010. At the
time of writing it stands at 0.8552 to the US dollar.
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