Dollar Strengthens
Posted on: Jul 9th, 2008 | By Doug Casey | Filed under US Dollar & Forex Trading
In the currency market, the dollar moved higher against the euro. Late Tuesday, the euro was trading at $1.5666 vs. $1.5727 on Monday.
Traders reacted positively to a closely-scrutinized speech by Fed Chair Ben Bernanke.
“We are currently monitoring developments in financial markets closely and considering several options, including extending the duration of our facilities for primary dealers beyond year-end,” Bernanke said.
“The talk has apparently assuaged credit concerns slightly,” wrote analysts at Action Economics.
Meanwhile, over in Tokyo, “Little was expected on currency policy issues from the summit of G8 leaders and this is pretty well … how things turned out,” wrote Simon Derrick, a foreign-exchange strategist at Bank of New York Mellon (BK).
The only reference in the joint G8 statement on the world economy was a call for “some emerging economies with large and growing current account surpluses” to allow their exchange rates to move, an apparent swipe at China for failing to allow further appreciation of the yuan.
The day’s only significant number was the index of sales contracts on previously owned U.S. homes from the National Association of Realtors, which showed a 4.7% decline from April to May. The index was also down 14% year over year.
Source: Dollar Strengthens
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