Forex: Greenback steady on Chicago Fed National Activity Index update

on Jul 22, 2013
Listen Monday July 22nd:_ So far at this early point in the week, and with a virtual absence of fundamental news from most places, the US dollar has been trading slightly down against the other majors.

Livening up the scene, the Federal Reserve Bank of Chicago released its National Activity Index (CFNAI) data for June at 13:30 BST, logging an increase to -0.13 from May’s -0.29, an indication of slight improvement in economic activity last month.
But the reading will have disappointed the analysts who’d been expecting a rise to 0.00.
The three-month moving average of the index, CFNAI-MA3, increased to –0.26 in June from –0.37 in May, marking its fourth consecutive reading in negative territory.

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Following this underwhelming data the greenback has remained subdued against the other majors and currently is trading as follows:
EUR/USD – 1.3162
GBP/USD – 1.5333
USD/JPY – 99.92
In other news, the finance ministers and central bank chiefs of the G20 countries wrapped up their two-day meeting on Saturday, a highlight of which was the determination expressed by the leading developed countries for multinationals to pay more taxes.

Major global companies, including Google, Amazon, Facebook and Starbucks, are contriving to pay low amounts of tax relative to their enormous incomes, sparking public indignation in European countries suffering from high debt, low growth and austerity measures.
In publishing its keenly-awaited report, submitted to the G20 meeting on Friday, the Organization for Economic Co-operation and Development observed: “National tax laws have not kept pace with the globalization of corporations and the digital economy, leaving gaps that can be exploited by multinational corporations to artificially reduce their taxes.”
The 15 point plan, which includes methods to close loopholes and allow countries to tax profits held in offshore subsidiaries, will be implemented over a two-year period if adopted at the multilateral level.


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