The Eurozone economy turned out to be better than expected in 1Q12. Notwithstanding consensus forecast that the region would technically fell to recession with two consecutive quarters of contractions, the flash GDP data came in flat, compare with 4Q12′s -0.3% drop. Despite the apparently stronger than expected growth figure, the upside surprise mainly concentrated in a few countries and more peripheral economies, e.g.: Italy, have confirmed sharp recession. Investors should remain cautious about the Eurozone economic outlook. While the preliminary data still has chance to be revised lower, deep contraction might actually be reflected in the second quarter due to member countries’ fiscal consolidation.

The 17-nation bloc reported a flat reading (q/q) in GDP growth in 2Q12, better than market expectation of a -0.2% and 4Q11′s -0.3% contractions, with the biggest contribution coming from Germany’s +0.5% gain. Looking in details, the report unveiled huge dispersion among the member countries. While Germany reported strong growth and Belgium also showed a rebound of +0.3%, the French economy was unfortunately flat during the quarter, showing deceleration from the +0.1% and +0.2% expansion in 1Q12 and 4Q11 respectively while economy slid -0.2% in the Netherlands.

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Over the past 12 hours, we have seen very little consistency in the performance of the U.S. dollar which is unchanged against the EUR, JPY and CHF, higher against the GBP and AUD and lower against the CAD and NZD.  Although stock futures are pointing to a lower open, currencies are struggling to hold onto their gains against the dollar following much weaker than expected Chinese data.

For any skeptics questioning the validity of the Federal Reserve’s dovishness, the latest inflation report provides solid evidence for why easy monetary policy is still needed.  Not only has job growth in the U.S. slowed but producer prices fell 0.2 percent in the month of April.  Excluding food and energy costs, PPI increased but still at a slower pace than the previous month.  Core prices may be more important to central bankers, but the trend of headline inflation cannot be ignored.  With the U.S. dollar strengthening and commodity prices ticking lower over the past month, there is a reasonable chance that lower PPI could translate into lower CPI.  The preliminary University of Michigan consumer sentiment report for the month of May is due later this morning and we expect confidence to retreat given the recent pullback in equities.  

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In keeping with GRATA’s practice of informing clients regarding important legal developments that might influence their business, we draw your attention to the following recent changes in Kazakhstani financial legislation that occurred during the period of January – March 2012. View the full text of this document

The EUR/USD and USD/JPY once again turned bearish during overnight trading as uncertainty regarding Greece’s new parliament led to additional risk aversion in the marketplace. Commodities and precious metals were also down during the Asian session. Crude has fallen to the $97 a barrel level, while gold dropped over $6 an ounce.

Main News for Today

EUR German Industrial Production- 10:00 GMT
• Forecasted to come in at 0.8%, well above last month’s -1.3%
• If true, may lead to moderate risk taking in the marketplace which could help euro

EUR ECB President Draghi Speaks- 12:30 GMT
• Any mention of French and Greek elections and their potential impact on the euro-zone recovery could lead to volatility for euro

Read more forex news on our forex blog

EURJPY Forecast The EURJPY was corrected higher yesterday, filled the weekend gap and topped at 104.43. The bias is bullish in nearest term but as long as stays below 105.60 I still prefer to sell on rallies at this phase. Immediate support is seen around 103.85. A clear break below that area could trigger further bearish pressure testing 103.50 – 103.00 area. On the upside, a clear break above 104.44 could continue the bullish correction phase testing 105.00 – 105.60.

GBPJPY  Forecast The GBPJPY failed to continue its bearish momentum yesterday, topped at 129.46. The bias is bullish in nearest term testing 130.00. However note that medium term outlook is unclear. Price is still making lower highs since fell from 133.47 suggests the bearish phase remains intact but with potential consolidation phase. Immediate support is seen around 129.00. A clear break back below that could lead price to neutral zone in nearest term retesting 128.37. On t

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Since weve begun a brand new year, its a great opportunity to closely examine your finances and look for opportunities to improve them. When was the last time you checked out your bank accounts? An improvement you can make today is transferring your money to a higher earning investment. CD rates in Honolulu are competitive if you know where to look, so find out if theres a bank or credit union in the neighborhood offering a great rate.

One of the greatest pros of choosing Honolulu CD rates over traditional savings accounts and rates is that theyre often quite a bit higher. This is especially true when it comes to CDs with longer terms. For those who dont need access to savings for a while, a CD is the higher-earning option.

Please note that the featured Honolulu CD rates are accurate as of January 23, 2012, but may change in the future at the discretion of the bank or credit union. There may also be additional requirements in order to qualify for an account. Please confirm interest rates before opening an account.

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Youve probably heard talk about market uncertainty in the financial news recently. But when are the market trends ever certain? The constant uncertainties contribute to your frustrations as a trader, and you need to have a method for dealing with the ups and downs. Every successful trader has one.

Since 1999, Elliott Wave Internationals senior analyst and trading instructor Jeffrey Kennedy has produced hundreds of trading lessons exclusively for his subscribers. One of these lessons, The Three Phases of a Traders Education, gives you Jeffreys tips on becoming a consistently successful trader.

Here it is; we hope youll find it helpful.

The Three Phases of a Traders Education: Psychology, Money Management, Method

Aspiring traders typically go through three phases in this order:

1. Methodology The first phase is that all-too-familiar quest for the Holy Grail a trading system that never fails.

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In a January 6, 2012 decision by Justice Kornreich, the court granted a bank’s motion to dismiss claims brought by the Palestine Monetary Authority (PMA). The PMA sought monetary damages and other relief based on the bank’s restraining funds potentially subject to judgments rendered in two different federal district court litigations. The federal district court litigations were against the Palestine Liberation Organization (PLO) and the Palestinian Authority (PA), the PMA was not a party to either suit. Nevertheless, the plaintiffs in the federal district court litigations served restraining notices on the bank holding the PMA’s funds under the theory that the PMA and the PA and/or PLO were really the same entity.

The first federal court litigation (the Strachman litigation) spawned a number of additional suits and motions. On lawsuit was a State court action in which the court determined, in an April 2007 decision, that the PMA is a separate juridical entity from the PA and the bank should release the restrained funds. The b

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Riskier currencies such as the aussie and kiwi continue to fall against the USD. As uncertainty remains across the market, traders can be expected to look towards traditionally stable currencies like the greenback. As of this morning, the aussie is lagging against the greenback at $1.0604 and the NZD is hovering around $0.8131 against the USD.

Heading into this afternoon, we’ll see news coming out of Canada regarding its PMI numbers. Additionally, Australia will be releasing various economic figures, including its RBA rate statement. This news does hold the potential to influence more volatile currencies’ current weakness against the American dollar.

Read more news on our forex blog.

Risk aversion dominates the market today as global equities extend this week’s slide. Investors are getting nervous as the Greek PSI debt swap deadline approaches. There have been rumors that Greece could extend the March 8 deadline to improve participation, but that was denied. EU Economic and Monetary Affairs Commissioner Rehn expressed his confidence that the PSI deal would be successfully concluded. But markets are clearly not comforted by the words. 12 of the creditors steering committee agreed to join in the debt swap deal so far, those declared should be holding around 20% of the bonds. It should be noted that Greece must achieve 66% participation to avoid disorderly default this month; above 75% to avoid activating CAC which could be deemed as default by ISDA.

Other news from European are not positive. Rehn urged Spanish prime minister Rajoy to define a medium term budget strategy and present the 2012 budget to the commission asap after Rajoy broke the agreement with EU and revised up the deficit target last week. Also, there are talks that Portugal would eventually require a second bailout even though it’s on track with its austerity measures as the country is dragged deeper into recession by the austerities.

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