Dollar Posts Slight Gain on Euro
Nov 6th, 2008 | By Doug Casey | Category: Financial NewsIn the currency market, the dollar edged higher against the euro. Late Wednesday, the euro was trading at $1.2948 vs. $1.3002 on Tuesday.
In the wake of Obama’s election, “What started as a moderately negative trading session overnight, ended with risk aversion firmly back in the driver seat,” said Matthew Strauss, of RBC Capital Markets.
Looking ahead, Kathy Lien, director of currency research at GFT, said that, “In the long run….the dollar could rally as a new president takes the helm. If history is a reliable leading indicator, over the next six months, the U.S. dollar should appreciate against the euro and the Japanese yen. We saw this in 6 out of the last 7 elections.”
But Lien added a caveat: “However this economic environment, the possibility of protectionist policies by Obama and the likely increase in the U.S. budget could also hurt the dollar.”
Meanwhile, the day’s hard data was grim. Companies in the U.S. private sector shed 157,000 jobs in October, according to the ADP employment report. The ADP report often presages the Labor Department’s jobs report, due tomorrow.
Separately, the Institute for Supply Management said its nonmanufacturing index fell to a record low of 44.4% in October, from 50.2% in September. Readings below 50% indicate more firms are contracting than growing.
Source: Dollar Posts Slight Gain on Euro
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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.