Forex Fundamental Analysis

Another good week for the world’s major stock exchanges was slightly marred by the Nasdaq which was the only major exchange to slip back.

On the same day that a major US city, Detroit, filed for bankruptcy protection with debts of at least $15 billion (and potentially as high as $20 billion), credit ratings agency Moody’s chose to revise its credit outlook for the nation upwards.

To an extent, you have to feel sorry for the Greek government since they were not the people who ignited the European Sovereign debt crisis by lying over the state of the Greek economy and fudging the convergence issues to allow Greece to join the Euro.

The Organisation for Economic Cooperation and Development aims to provide a forum where governments can cooperate towards improving the economic and social well-being of the world’s people which is OECD’s mission.

Economics, as I have pointed out before, is a cyclical beast. Bull runs when markets rise end followed by Bear runs (if I may) when pessimism and nervousness prevail and markets fall.

All of the major stock markets ended the week higher, spurred on by clarification from the US Federal Reserve that the asset purchase programme is to continue for the foreseeable future.

None of the US economic parameters have changed significantly recently, but markets are experiencing significant swings.

The President of Portugal, Anibal Cavaco Silva, has rejected opposition calls for immediate, fresh elections in the wake of the resignations of the Finance and Foreign Ministers resigned within a week of each other.

The latest turning of the screws has been brought about by ratings agency Standard and Poor’s which has decided to downgrade its evaluation of Italy’s sovereign credit rating from BBB+ to BBB.

Figures recently released show that the US economy created 195000 new jobs in June.

With the exception of Germany’s Dax, all of the major stock markets ended the week higher.

The Global Financial Crisis has taken its toll on politicians around the world with many governments falling as voters take out their frustration at austerity measures, unemployment and the general economic plight they see all around them.

One of the more telling statistics about the depth of the Global Financial Crisis is provided by the average age of American cars and trucks.

The heads of the world’s leading 20 economies (G20) have been meeting in Los Cabos, Mexico and the on-going European sovereign debt crisis has been at the top of the Agenda.

In a similar way to employment, manufacturing output is a lagging indicator of economic recovery.