Dollar Moves Higher
Jul 8th, 2009 | By Doug Casey | Category: US Dollar & Forex TradingIn the currency market, the dollar moved higher again against the euro. Late Tuesday, the euro was trading at $1.3918 vs. $1.3986 on Monday.
The buck has been benefiting lately from weak world equity markets, as investors begin to exhibit greater risk aversion.
The euro got an initial boost as the Economy Ministry in Berlin said German factory orders expanded 4.4% in April. That marked the biggest advance in two years for the zone’s largest economy, but its influence petered out quickly.
A lack of clear direction could be ongoing. “The markets are looking very indecisive at this point,” said T.J. Marta, chief strategist at Marta on the Markets. “It could be the exhaustion of investors and traders, having just priced in — and then out — financial Armageddon. It could also be the cross currents of data, as investors are barraged by conflicting reports.”
There is also caution ahead of the G-8 summit, commencing today in Italy. It’s expected that the meeting will feature renewed debate over whether the U.S. dollar should be replaced as the world’s reserve currency.
The issue isn’t specifically on the agenda for G8 leaders, but officials from Russia and elsewhere have said it will be discussed.
Prefiguring the tone of the discussion, Kremlin aide Arkady Dvorkovich said that, “China and Russia will state their stance that the global currency system needs smooth evolutionary development and this is connected with the creation of several regional reserve currencies, which may then become international.”
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Doug Casey is a contrarian investor, sought-after public speaker and author of several books. His work "Crisis Investing" held the position of # 1 bestseller on the New York Times list for 26 consecutive weeks. Doug's unusual views on the economy - and just about everything else - have gained a huge following in the investment community, and it certainly helps that his stock recommendations of undervalued junior exploration companies have made his subscribers millions. Now in its 27th year, Doug's monthly newsletter, the International Speculator, is one of the most established and esteemed publications on gold, silver and other natural resource investments. Together with the Casey Energy Speculator, it covers a broad range of carefully selected stocks with the very real potential of double- and triple-digit returns within 12 to 24 months.