Forex Daily

Nationwide Building Society has announced that UK house prices have had there largest monthly fall since 1991 and according to the report prices have fallen by 2.5% during May.

The lender also said that prices were now 4.4% lower than this time last year, which equates to a drop of nearly £8,000 that has taken the average house price down to £173,583.

The US Dollar was steadied a little against the yen and the euro in today’s Asian trade as investors waited for the release of US housing data, a key indicator on the state of the US economy.

The National Association of Realtors will release the figures for existing home sales throughout April this afternoon, and many analysts are expecting it will show that the housing sector remains in a slump.

Oil prices have risen above $129 a barrel as Opec says that it would not be boosting oil output over the next few months. This raised concerns about supply, and the speculation that China would need to import more oil after its earthquake has also driven prices.

Analysts are warning that oil prices could reach up to $150 a barrel before the end of the year, and with the US Dollar weakening investors are looking at buying commodities instead of the Dollar.

On Friday a deadline set by Electronic Arts for shareholders of Take-Two interactive software passed. The US video game giant offered shareholders an unsolicited $25.74 per share valued in the reign of $1.9bn, after the Take-Two board of directors rejected the bid as undervaluing the business.

There has been no comment from either company after Friday’s deadline set by EA and it is likely that Take-Two shareholders will hold out for more money. Take-Two’s directors had refused to hold takeover talks before the launch of Grand Theft Auto IV on April 29th.

The Federal Reserve has auctioned more than $7bn in securities, which it hopes that it will boost the credit markets.

The Federal Reserve last year started a succession of auctions to help shore up liquidity after the credit crunch. The central bank is hoping to stop the housing slowdown from turning into wider recession.

In exchange for the securities, investment firms can obtain a short-term cash loan by trading it with their more risky investments, including mortgage backed risks.

For the second month in a row sales on UK High Streets have fallen, according to figures from the British Retail Consortium (BRC). Like-for-like sales fell by 1.5% in April compared to the same month in 2007. Total sales, which include shops that were not running last year rose by 1.0% last month.

The BRC’s figures only take into account the value of sales from a selection of retailers. It is the first time that the BRC’s figures had fallen for two consecutive months in a row since the first quarter of 2005.

Europe’s biggest bank HSBC announced that it has written off $3.2bn (£1.6bn) in the first quarter of 2008, as a result of the US sub-prime market.

The write offs are lower than the final quarter of 2007 and are in line with HSBC’s predictions. It is also reported that a further $2.6bn is to be written off in its global banking sector.

The bank has stated that profits in the US had fallen this year but profits in other markets had remained sturdy. This latest writedown has taken the total amount of bad debts sustained by the bank to $14.6bn in the US during the last year.

The dollar fell largely on Friday as stuttering stock markets and a record high oil prices weighed on the U.S. currency, while weakening risk demand improved the low-yielding yen.

The euro added to gains made in the previous session after the European Central Bank said that inflation remained their top concern, signalling that the bank has no intentions of cutting interest rates soon. The euro recovered after falling to a two-month low against the Dollar.

In the United States commercial bankruptcy has jumped 56% in April compared with the same time last year, a report has shown. Businesses filing for bankruptcy rose to 5,173, while the total including those who file for individual bankruptcy rose to 93,096.

Tropicana Entertainment, which owns numerous casinos in Las Vegas and Atlantic City, has become the latest firm to file for protection against bankruptcy. Known as Chapter 11, this allows the company to reorganise and to plan strategies to keep the business running and pay creditors over a period of time.

Analysts say that a deal for Countrywide Financial to sell itself to the Bank of America could be at risk. The mortgage lender, which is the third largest in the US, last week announced a loss of $893m in the first three months of 2008, adding to speculation that the Bank of America could renegotiate of walk away from a deal altogether.

In a statement the bank made clear that the deal was still on by saying that the $4bn transaction was “on track to close as agreed”.