Obama Nominates Yellen as New Federal Reserve Chair

Investing.com ג€' U.S. President Barack Obama on Wednesday nominated Janet Yellen as the new Chair of the Federal Reserve, replacing Ben Bernanke, who steps down in early 2014.

Yellen, current Vice Chair of the U.S. central bank, is widely seen by markets as sticking with currently ultra-loose monetary policies put in place under Bernanke, especially the bank's USD85 billion in monthly asset purchases designed to spur recovery by driving down long-term interest rates.

Yellen, 67, has said in the past that she does not see a conflict of interest when prioritizing lowering unemployment rates over keeping inflation rates in check.

Obama thanked Chairman Bernanke for his service earlier and praised Yellen's past performance at the Fed.

"Janet is renowned for her good judgment. She sounded the alarm bell early about the housing bubble, about excesses in the financial sector and about the risks of a major recession," Obama said, adding that she has "a keen understanding is about how markets and the economy works, not just in theory but also in the real world."

"Janet is committed to both sides of the Fed's dual mandate. She understands the necessity of a stable financial system where we move ahead with the reforms that we have begun to protect consumers, to ensure that no institution is too big to fail and to make sure the taxpayers are never again left holding the bag because of the mistakes of a reckless few."

"And at the same time she is committed to increasing employment. She understands the human costs when Americans can't find a job."

Following Obama's remarks, Yellen said she was "honored and humbled" by the nomination.

"The past six years have been tumultuous for the economy and challenging for many Americans," Yellen said, adding "We have made progress. The economy is stronger and the financial system sounder."

Yellen's nomination sparked relief buying for the dollar despite her being a noted policy dove and seen as sticking with currently loose monetary policies, as she will likely win confirmation in the Senate.

While some Republican lawmakers have expressed concerns, others said they expected a smooth transition of leadership in the U.S. central bank.

Yellen was seen competing for the job against former Treasury Secretary Larry Summers, who bowed out of the race last month, and her nomination clears up policy uncertainty, which gave the dollar room to rise despite expectations for overall monetary policy to remain on the loose side.

Bernanke is due to step down Jan. 31.

Prior to her appointment as Vice Chair, Dr. Yellen served as President and Chief Executive Officer of the Twelfth District Federal Reserve Bank, at San Francisco.

Yellen is Professor Emeritus at the University of California at Berkeley where she was the Eugene E. and Catherine M. Trefethen Professor of Business and Professor of Economics and has been a faculty member since 1980.

Yellen also served as chair of the White House Council of Economic Advisers during the Clinton administration.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.47% at 80.45.

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U.S. stocks gain on Yellen nomination, shutdown weighs; Dow rises 0.18%

Investing.com ג€' U.S. stocks rose on Wednesday after U.S. President Barack Obama appointed Janet Yellen as head of the Federal Reserve, replacing Ben Bernanke, who steps down in January.

A fiscal impasses that has closed the federal government continued to drag on Wednesday, which dampened gains.

At the close of U.S. trading, the Dow Jones Industrial Average finished up 0.18%, the S&P 500 index rose 0.06%, while the Nasdaq Composite index fell 0.46%.

Yellen's nomination sparked demand for stocks due to her perceived dovish policy stance and tendency to favor current policies, including the Fed's USD85 billion in monthly asset purchases, which push up stock prices by driving down interest rates to spur recovery.

Weighing on gains, however, was a U.S. government shutdown that dragged on with few signs of a breakthrough ahead of an Oct. 17 deadline to raise the limit on federal debt borrowing and avoid a default sometime afterwards.

President Obama has insisted that he will only enter negotiations with congressional Republicans after the government is reopened and the U.S. debt ceiling is raised without conditions.

Still, reports that House Republicans and Senate Democrats are mulling approving short-term increases to the debt limit to stave off defaults allowed for gains despite the uncertainty.

Elsewhere, investors began to brace for a wave of earnings.

On Tuesday, Alcoa kicked off the reporting season announcing it earned USD24 million, or USD0.02 per share, in the July-September quarter, better than a loss of USD143 million, or USD0.13 cents per share during the same quarter a year ealier.

In other corporate news, Hewlett-Packard CEO Meg Whitman told an analyst meeting that revenue would stabilize in fiscal year 2014 and accelerate in 2015.

Leading Dow Jones Industrial Average performers included AT&T, up 1.96%, IBM, up 1.39%, and Goldman Sachs, up 0.88%.

The Dow Jones Industrial Average's worst performers included Merck, down 0.96%, Boeing, down 0.81%, and The Travelers Companies, also down 0.81%.

European indices, meanwhile, finished largely lower.

After the close of European trade, the EURO STOXX 50 rose 0.05%, France's CAC 40 fell 0.16%, while Germany's DAX 30 fell 0.46%. Meanwhile, in the U.K. the FTSE 100 finished down 0.44%.

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Gold dips as dollar gains on hopes for end to U.S. fiscal deadlock

Investing.com ג€' Gold prices noved lower on Tuesday as the dollar regained strength amid hopes that lawmakers and the White House will negotiate an end to a spending stalemate that has shut down the U.S. government and is opening the door to defaults in the coming weeks.

The deadlock has weakened the dollar, which tends to trade inversely with gold.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,322.90 during U.S. afternoon hours, down 0.17%.

Gold prices hit a session low of USD1,316.10 a troy ounce and high of USD1,330.10 a troy ounce.

Gold futures were likely to find support at USD1,308.80 a troy ounce, Monday's low, and resistance at USD1,375.10, the high from Sept. 19.

The December contract settled up 1.16% at USD1,325.10 a troy ounce on Monday.

Despite a government shutdown in its second week, markets grew a little less worried that the deadlock will affect negotiations to raise the U.S. debt ceiling, which the U.S. Treasury Department has estimated will be reached by Oct. 17, after which the risk of default rises.

While the White House and congressional Republicans were unable to agree on terms to fund the government, talk both sides are making plans to raise the debt ceiling and avoid default sparked some relief demand for the dollar on Tuesday and sparked a round of profit taking for gold.

A U.S. default could roil markets and slow U.S. recovery by further eroding confidence in Washington's ability to craft economic policy,

Elsewhere on the Comex, silver for December delivery was up 0.10% at USD22.408 a troy ounce, while copper for December delivery was down 0.07% and trading at USD3.294 a pound.

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Forex - Dollar makes cautious gains on hopes for U.S. impasse deal

Investing.com ג€' The dollar inched up against most major currencies on Tuesday even as a government shutdown dragged on with no end in sight.

Hopes that lawmakers will at least find a way to raise the debt ceiling later this month and avoid default allowed for some dollar demand.

In U.S. trading on Tuesday, EUR/USD was down 0.07% at 1.3572.

Despite a government shutdown in its second week, markets grew a little less worried that the deadlock will affect negotiations to raise the U.S. debt ceiling, which the U.S. Treasury Department has estimated will be reached by Oct. 17, after which the risk of default rises.

While the White House and congressional Republicans remain unable to agree on terms to fund the government, talk both sides are quietly making plans to raise the debt ceiling and avoid default sparked some relief demand for the dollar on Tuesday.

Earlier Tuesday, President Barack Obama said he saw no serious proposals from Republicans needed to end the impasse, which sent stocks falling though the dollar fared better.

The White House insists Republicans open the government before addressing fiscal issues, while many Republicans want the president's healthcare reform law scrapped or delayed before doing as such, with a stalemate resulting.

IMF Chief Economist Olivier Blanchard said earlier that a prolonged failure to raise the U.S. debt ceiling would "almost certainly derail the recovery" and warned the U.S. to slow the pace of its deficit reduction program.

In its latest World Economic Outlook report, the IMF downgraded its forecasts for the global economy, saying it now expects growth of 2.9% this year, down from 3.1% in July. It expects growth of 3.6% in 2014, down from 3.8%.

The euro, meanwhile, saw support after the IMF said it expected the euro zone economy to contract by 0.4% this year, less than 0.5% it forecast in July. It left its 2014 growth forecast unchanged at 1%.

Also Tuesday, data showed that German factory orders unexpectedly fell 0.3% in August following a 1.9% drop in July. Analysts had been expecting a gain of 1.2%.

The greenback was up against the pound, with GBP/USD down 0.07% at 1.6085.

Sterling found support after the IMF upgraded its economic outlook for the U.K. on Tuesday.

The Fund now expects the U.K. economy to expand by 1.4% this year, up from 0.9% and sees growth of 1.9% in 2014, up from its July forecast of 1.5%.
Profit taking erased the pounds gains.

The dollar was up against the yen, with USD/JPY up 0.31% at 97.01, and up against the Swiss franc, with USD/CHF up 0.14%at 0.9040.

The dollar was mixed against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.52% at 1.0366, AUD/USD up 0.08% at 0.9437 and NZD/USD trading down 0.08% at 0.8298.

The loonie softened after official data showed that the countryג€™s trade deficit widened unexpectedly in August, expanding to CAD1.31 billion from a deficit of CAD1.19 billion in July. Analysts had expected the deficit to narrow to CAD1.0 billion.

A separate report showed that Canadian housing starts rose to 193,600 units last month from 184,000 units in August. Analysts had expected housing starts to increase to 185,000 units in September.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.09% at 80.09.

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Forex - Dollar softens on U.S. debt ceiling uncertainty

Investing.com ג€' The dollar softened against most major currencies on Monday as fears began to grow that a fiscal impasse that closed the U.S. government will carry over into upcoming debt-ceiling debates and raise the possibility of government defaults.

In U.S. trading on Monday, EUR/USD was up 0.15% at 1.3575.

An ongoing impasse among U.S. lawmakers and the White House over terms needed to create a spending package and reopen the government sent investors avoiding the dollar on Monday.

Markets were also growing increasingly worried that the deadlock will affect negotiations to raise the U.S. debt ceiling, which the U.S. Treasury Department has estimated will be reached by Oct. 17, after which the risk of default rises.

Republican House Speaker John Boehner said Sunday the House will not support bills to fully reopen the government or increase the government debt ceiling unless the Obama administration agrees to talks aimed at reducing the deficit.

A U.S. default could roil markets and slow U.S. recovery by further eroding confidence in Washington's ability to craft economic policy.

Meanwhile in the euro zone, data revealed that the economy grew by 0.3% in the second quarter, unchanged from a preliminary estimate and in line with forecasts.

A separate report showed that the Sentix index of euro zone investor confidence dropped to 6.1 in October from 6.5 in September as concerns over the political impasse in the U.S. hurt sentiment.

Analysts had expected the index to rise to 10.6 this month.

The greenback up against the pound, with GBP/USD up 0.50% at 1.6089.

The yen, meanwhile, saw safe-haven demand in a session absent of U.S. economic indicators due to the government shutdown.

The dollar was down against the yen, with USD/JPY down 0.60% at 96.88, and down against the Swiss franc, with USD/CHF down 0.38%at 0.9038.

The dollar was mixed against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.15% at 1.0311, AUD/USD up 0.01% at 0.9433 and NZD/USD trading up 0.02% at 0.8322.

Official data showed that the number of building permits issued in Canada in August was down 21.1% following an upwardly revised increase of 21.4% in July.

Analysts had expected building permits to decline by 7%.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.26% at 80.03.

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U.K. RICS house price balance rises more-than-expected

Investing.com ג€' The U.K.ג€™s RICS house price balance rose more-than-expected last month, industry data showed on Monday.

In a report, RICS said that U.K. RICS house price balance rose to a seasonally adjusted 54%, from 41% in the preceding month whose figure was revised up from 40%.

Analysts had expected U.K. RICS house price balance to rise to 45% last month.

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Forex - EUR/USD up during the Asian session

Investing.com ג€' The Euro was higher against the U.S. Dollar on Sunday.

EUR/USD was trading at 1.3563, up 0.07% at time of writing.

The pair was likely to find support at 1.3506, Wednesdayג€™s low, and resistance at 1.3645, Thursdayג€™s high.

Meanwhile, the Euro was up against the British Pound and down against the Japanese Yen, with EUR/GBP gaining 0.01% to hit 0.8466 and EUR/JPY falling 0.13% to hit 131.94.

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Forex - GBP/USD up during the Asian session

Investing.com ג€' The British Pound was higher against the U.S. Dollar on Sunday.

GBP/USD was trading at 1.6038, up 0.18% at time of writing.

The pair was likely to find support at 1.6006, Fridayג€™s low, and resistance at 1.6260, Tuesdayג€™s high.

Meanwhile, the British Pound was up against the Euro and down against the Japanese Yen, with EUR/GBP shedding 0.07% to hit 0.8460 and GBP/JPY falling 0.08% to hit 155.91.

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EC announces poll dates for 5 states

Moneycontrol Bureau

The Election Commission has announced assembly election dates for five states - including Chhattisgarh, Madhya Pradesh, Mizoram, Rajasthan and Delhi between November 11 and December 4. The votes will be counted on December 8.

EC says Delhi and Mizoram will go to polls on December 4, Rajasthan on December 1, Madhya Pradesh on November 25 and Chhattisgarh on November 11 and 19.

Bye-elections to fill the casual vacancies in the State Legislative Assemblies of Gujarat and Tamil Nadu will take place on December 4.

The terms of the Legislative Assemblies of the five states are due to expire soon Chhattisgarh on January 4, 2014; MP on December 12, 2013; Mizoram on December 15, 2013; Rajasthan on December 31, 2013 and Delhi on December 17, 2013.

As per the established practice, the Election Commission holds the General Elections to the Legislative Assemblies of the States whose terms expire around the same time.

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Parts of east, north east India to receive heavy rain in next 24 hours

North and north west India is expected to remain dry today. The cyclonic circulation over Madhya Pradesh has moved towards east Uttar Pradesh and is expected to bring good rain over Bihar, Jharkhand and east Uttar Pradesh, in the next 24 hours. Temperatures here will rise by 2 to 4 degrees during next 48 hours.

Assam and Meghalaya in the north east will also receive heavy rain at few places. West Bengal, Orissa and Chhattisgarh will receive light rain, though good showers are possible at a couple of places in the region. On the 7th of October rain will decrease significantly in east India. However, Madhya Pradesh and Chhattisgarh will continue to receive rain at many places. East India will have below normal temperatures for the next two days.

North coastal Andhra Pradesh, interior Karnataka, south Andhra Pradesh and south east Rajasthan will continue to get light rain at many places for the next 48 hours.

Monsoon generally withdraws completely, by this time of the year from entire north west India, west Madhya Pradesh, Gujarat, west and central Uttar Pradesh and Madhya Maharashtra. According to records maintained by IMD, the country experienced the longest monsoon this year.

By: Skymetweather.com

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