Dollar Slips
Feb 4th, 2009 | By Doug Casey | Category: Financial NewsIn the currency market, the dollar slid lower against the euro. Late Tuesday, the euro was trading at $1.3044 vs. $1.284 on Monday.
In a small ray of hope, the National Association of Realtors said the number of new sales contracts on existing homes jumped a seasonally adjusted 6.3% in December as buyers took advantage of lower mortgage rates and falling prices.
“Euro/dollar bulls were quick to capitalize on positive U.S. data following a lackluster performance during the European session,” wrote Matthew Strauss, senior currency strategist at RBC Capital Markets.
The euro was up despite data showing producer prices across the euro zone experienced their fifth consecutive monthly drop in December, bringing the annualized pace down to 1.8% from 3.3% in November.
The European Central Bank meets tomorrow, with most analysts expecting policy makers to keep the region’s key lending rate at 2%, after dampening remarks by ECB President Jean-Claude Trichet.
The Bank of England’s rate-setting Monetary Policy Committee also meets this week, and is expected to further cut key interest rates tomorrow, with no clear consensus on the outcome after BoE slashed the benchmark to an all-time low of 1.5% in January.
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