Dollar Surges Against Euro
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In the currency market, the dollar firmed against the euro. Late Tuesday, the euro was trading at $1.5482 vs. $1.5541 on Monday.
The latest bad economic news was good because, as has become the norm, it was less bad than predicted. The Commerce Department reported retail sales fell 0.2% in April, after a 0.2% gain in March. Better than the 0.3% drop economists projected. Over the past year, sales were up 2%, matching the slowest growth in five years.
But wait. “The U.S. dollar skyrocketed on the report because excluding autos, sales actually increased,” noted Kathy Lien, of DailyFx.com.
Meanwhile Fed members were out on the rubber chicken circuit. Dallas Federal Reserve President Richard Fisher told an audience in Midland, Texas that he had “absolute confidence over time…the dollar will be strong again.”
And San Francisco Fed President Janet Yellen said that, “My forecast is the most likely outcome over the next couple of years is that total and core inflation will moderate from present levels.”
At the same time, though, Gentle Ben Bernanke warned that the financial sector remains severely stressed. Bernanke said that the Fed’s cash infusions, while having met with some success, have not achieved their goal of stability, and that “financial markets are still far from normal.”
Source: Dollar Surges Against Euro
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Tags: Ben Bernanke, Cash Infusions, Commerce Department, Currency Market, dollar, euro, fed, Federal Reserve, Financial Sector, forex, inflation, Janet YellenAbout the Author
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.