How Does The Yuan Revaluation Affect Futures?
Currencies were the in the spotlight
today after China decided to end its 10-year peg to the US dollar. China’s central bank raised the value
of the Yuan +2.1% from 8.28 Yuan vs. the US dollar to 8.11 Yuan vs. the US
dollar and said they planned to link it to a
basket of currencies. Shortly after Malaysia announced plans to allow its
currency (the ringgit) to float more freely by changing its own peg to the US
dollar. All of the most widely traded Asian currencies rose vs. the US dollar
but the Yen was the main beneficiary rising against 15 of the 16 most actively
traded currencies.
The Japanese Yen
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than 3 years vs. the US dollar, up +2.07%.
European Government Bonds also rose on the Chinese Yuan
revaluation increasing the yield spread between European and US assets to the
widest in nearly 5 years.
Natural Gas
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-3.32%. Both Crude Oil
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fell despite a report by National Australia Bank Ltd. saying that oil may hit
$80 per barrel. Natural Gas looks set to test $6.91 chart support formed at the
06/30/05 low.
Soybeans
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consecutive day as over 3 inches of rain hit the Midwest.
Sugar
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PowerRating) +2.66% hit new highs on heavy volume. Sugar
was highlighted in the TradingMarkets.com Momentum 5 List last night.
Palladium
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+2.36%.
Initial Jobless Claims – actual 303K vs. 325k consensus.
Leading Indicators, M/M Change – actual 0.9% vs. 0.5%
consensus.
Philadelphia Fed Survey – actual 9.6 vs. 10.0 consensus.