Sterling could drop in forex trading

Tomorrow, both the ECB and the BOE are expected to make interest rate and monetary policy announcements. The ECB is expected to remain steady, and the BOE is expected to increase its asset purchase program.

A Greek deal is almost here again, maybe tomorrow or Friday or next week! It’s like dealing with an adolescent teen and their irreverent actions. Accountability and big picture politics do not seem to be included in the Greek decision process, otherwise there would be a greater sense of urgency and unity rather than domestic discord and non decisions.

The dollar is performing well around the world, thanks in part to a current lack of trust in the Euro. Thanks in part to the Greece debt crisis, the dollar has been slowly climbing. Japan, for the first time in a long time, has posted some economic struggling as well, although not nearly in the same boat as Europe. 2011 saw Japan post a trade deficit for the first time in over 30 years.

Currency trading with the Australian dollar

The Aussie has found a support level in forex trading against the US dollar today. Aussie is a little bit higher today, thanks to the latest news out of Australian. The RBA has decided to keep its interest rate at 4.25% -- even though the forex market had already priced in a cut.

Market surprises seem to be coming in three’s this morning. EUR is still in demand and is beginning to encroach on price tipping points that has more than a few weaker shorts worried. Last night, the RBA stuck to its guns and kept rates unchanged at +4.25%, resulting in the market being flat footed and the currency spiking to print 1.0815. Despite being close to even odds of nothing doing down under, market reaction indicates the breath of Governor Stevens surprise.

India’s economy will grow at its slowest rate in three years in the fiscal year ending in March, according to an outlook released on Tuesday by the government’s central statistics office.

The office revised its estimate for GDP growth for the year to 6.9 per cent. If the number is confirmed, it will mark a strong decline from last year’s 8.4 per cent.

Industrial production and foreign investments contracted, the rupee was Asia’s worst-performing currency, and the country’s current account and fiscal deficits increased.

The International Monetary Fund (IMF) said today that a recession in the Eurozone would likely reduce China’s actual growth by about 50 percent of the current projection. That would place China’s growth for 2012 at roughly 4 percent should the Eurozone crisis devolve into a recession.

Even stronger domestic fundamental data cannot pressure US bond prices. Longer dated securities again have caught a bid on concerns that the Greek Prime minister has requested the country’s finance ministry to prepare a document on the implications of a Greek default. Earlier today Treasuries came under pressure as dealers prepared to take down +$72b of new product this week. The government is to auction +$32b in three-year notes tomorrow, followed by +$24b of 10-year debt on Wednesday and $16b long-bonds on Thursday.

The Greek political leaders are under significant pressure to reach an agreement on needed cutbacks on Monday to comply with demands from the European Union and International Monetary Fund to secure a second bailout worth €130 billion ($171 billion).

Euro in forex trading

Lately, the euro forex trading forecast has been fairly choppy. And, today the euro is lower in forex trading on the currency market. However, if Greece figured out, a euro rally could be the result.