User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Friday October 22, 2004 - 14:39:10 GMT
Foreign Exchange Analytics - www.fxa.com

Share This Story:
| | Email

Forex: FOMC SF Fed President Yellen On The Dollar

FOMC SF Fed President Yellen On The Dollar

Yellen's speech in San Francisco late Thursday is in the spotlight as she again mentioned the dollar. Here is what she said in the context of describing factors that were depressing the intermediate-term real Fed funds rate. "Another factor that may be working in the same direction is the dollar, which has remained relatively high despite our large and growing trade deficit. A high dollar makes imports less expensive for us and makes our exports more expensive abroad, thereby undermining the demand for domestic output. In order to offset this drag on demand for domestically produced goods and services, interest rates must be lower than would otherwise be necessary to produce full employment in our economy. A relatively high dollar depresses the equilibrium real rate."

Context is paramount in this quote...something both US presidential campaigns ignore in parsing each sides quotes. Yellen is making observations not prescribing policy solutions, like a weaker dollar. She is observing that the dollar is relatively high to the size of the external imbalance full stop. She is also observing that the high dollar depresses US domestic activity and hence helps generate lower than historical average real Fed funds rate. However, on September 09, in Q&A she said if the dollar's value remains steady it will widen the US current account deficit even more (already alarmingly wide). She said any turnaround in the c/a deficit has to involve the dollar, but also stressed her time horizon was 10-20 years. It would appear that Yellen believes the dollar has a role to play in trade adjustment and over time it will depreciate. Is she keen on talking the dollar lower every chance she gets? This is doubtful. And it would be wrong to conclude that she would like a weaker dollar so that the real Fed funds intermediate-equilibrium rate would be reached sooner and at something closer to the historical norm.

Still it is curious that Yellen's (and McTeer's last week) comments on the dollar have not generated any clarification from the US Treasury. In the days of Rubin and Summers one would have seen immediate statements from the US Treasury reminding markets that dollar policy is sole purview of the Treasury Secretary and it alone speaks on dollar policy. Yellen is freelancing here and Treasury is not too concerned. Then again why should it be concerned? The dollar is not in a freefall based on Yellen's (or McTeer's) recent remarks suggesting the dollar needs to depreciate to facilitate trade adjustment. This Treasury is most keen on markets setting exchange rates and orderly moves in FX are likely to be ignored even if they happen after comments by FOMC members on the dollar and the trade deficit and traders sell the US currency. But the notion that the Bush administration or even freelancing FOMC members are eager to embrace a weak dollar to boost growth and shrink the trade gap is misguided. Frankly it would be irresponsible given the slippery slope it presents when the US needs $600bln a year in foreign savings to fill the gap between savings and investment. Officials risk managing an orderly dollar decline and markets turning it into a stampede, with official backing. And a stampede of dollar selling would risk sending US bonds and stocks lower, accelerating a US slowdown. Remember in two weeks is a presidential election. The dollar does not need to be a major problem or distraction in the campaign and economy with a last minute effort by the admin to talk down the dollar or use surrogates like Yellen and McTeer.

Then there is European thinking on the rise in euro/dollar. Yes it is a hedge against higher oil prices and commodities generally. But export-led growth is still the dominant strain in Europe and exports are growing fastest to China and the US (recall yuan is pegged). So this sword cuts two ways. ECB officials are happy with the Boca Raton accord that essentially said enough to euro/dollar appreciation and more support for dollar depreciation versus Asia's currencies. Still Euro Zone officials (central bankers and finance ministers) for the most part remain confident that the current expansion will continue despite the rise in the price of oil. And the confidence in the recovery is considerably higher than it was in February when euro/dollar reached 1.29. So it follows that ECB and Eurogroup protests over euro/dollar will not be seen until much higher levels...though this could change if the pace accelerates quickly and causes disruptions in asset markets).

David Gilmore
FXA

 

Forex Trading News

Forex Research

Daily Forex Market News
Forex news reports can be found on the forex research headlines page below. Here you will find real-time forex market news reports provided by respected contributors of currency trading information. Daily forex market news, weekly forex research and monthly forex news features can be found here.

Forex News
Real-time forex market news reports and features providing other currency trading information can be accessed by clicking on any of the headlines below. At the top of the forex blog page you will find the latest forex trading information. Scroll down the page if you are looking for less recent currency trading information. Scroll to the bottom of fx blog headlines and click on the link for past reports on forex. Currency world news reports from previous years can be found on the left sidebar under "FX Archives."



Elevate Your Trading With The Amazing Trader!

The Amazing Trader includes:
  • Actionable trading levels delivered to YOUR charts in real-time.
  • Live trading strategy sessions.
  • Market Updates with Trading Tools.

Register To Test Your Amazing Trader


Trading Ideas for 20 October 2017

Register for the Amazing Trader

1.

Amazing Trader EVENT RISK Calendar:

Fri 20 Oct
12:30 CA- Retail Sales & CPI
14:00 US- Existing Homes Sales


Tue 24 Oct
All Day flash PMIs
Wed 25 Oct
01:30 AU- CPI
08:00 DE- IFO Survey
08:30 GB- GDP
14:00 CA- BOC Decision
14:30 US- EIA Crude
Thu 26 Oct
11:45 EZ- ECB Decision
12:30 US- Weekly Jobless
14:00 US- Pending Homes Sales
Fri 27 Oct
12:30 US- GDP
14:00 US- final Univ of Michigan

Forex Trading Outlook


Potential Trading Opportunities


  • POTENTIAL PRICE RISK: High Fri-- 12:30 GMT CA- Retail Sales and CPI. Top economic indicators.


  • POTENTIAL PRICE RISK: HIGH Fri-- 14:00 GMT US- Existing Homes Sales. Top Housing statistic.



John M. Bland, MBA
co-founding Partner, Global-View.com

EXCLUSIVE: Global-View Daily Trading Chart Points Updated

EXCLUSIVE: Global-View Free Forex Database updated




TRADER ADVOCACY ARTICLES

Trader's Advocate Articles..

pic

Retail Forex Brokerage Changing!

Are you looking for your first broker or do you need of a new one? There are more critical things to consider than you might have thought.

We were trading long before there were online brokers. Global-View has been directly involved with the industry since its infancy. We've seen everything and are up-to-data with recent regulatory changes.

Our Best Brokers listing section includes:Forex Broker Reviews, Forex Broker Directory, Forex Broker Comparisons and advice on How to Choose a Forex Broker

If would like guidance, advice, or have any concerns at all ASK US. We are here to help you.

SEE Our Best Brokers List

Currency Trading Tools

  • Live rates, currency news, fx charts. 

  • Research reports and currency forecasts.

  • Foreign Exchange database and history.

  • Weekly economic calendar.

Directory of  Forex trading tools

 
Terms of Use    Disclaimer    Privacy Policy    Contact    Site Map


Forex Forum
Forex Trading Forum
Forex Forum + forex rates
Forex Forum Archives
Forex Forum RSS
Free Registration

Trading Forums
Currency Forum Guide
Forum Directory
Open Forum
Futures Forum
Political Forum
Forex Brokers
Compare Forex Brokers
Forex Broker News
Forex Broker Hotline

Online Forex Trading
Forex Trading Tools
Currency Trading Tools
Forex Database
FX Chart Points
Risk/Carry Trade Chart Points
Economic Calendar
Quicklinks to Economic Data
Currency Futures Swaps
Fibonacci Calculator
Currency Futures Calculator

Forex Education
Forex Learning Center
FX Trading Basics Course
Forex Trading Course
Forex Trading Handbook

Forex Analysis
Forex Forecasts
Interest Rate Forecasts
Central Bank Forecasts

FX Charts and Quotes
Live FX Rates
Live Global Market Quotes
Live Forex Charts
US Dollar Index Chart
Global Chart Gallery
Daily Market Tracker
Forex News
Forex Blog
Forex News
Forex Blog Archives
Forex News RSS
Forex Services
Forex Products
GVI Forex
Free Trials
FX Bookstore
FX Jobs and Careers
Jobs USA
Jobs UK
Jobs Canada

Forex Forum

The Global-View Forex Forum is the hub for currency trading on the web. Founded in 1996, it was the original forex forum and is still the place where forex traders around the globe come 24/7 looking for currency trading ideas, breaking forex news, fx trading rumors, fx flows and more. This is where you can find a full suite of forex trading tools, including a complete fx database, forex chart points, live currency rates, and live fx charts. In addition, there is a forex brokers directory where you can compare forex brokers. There is also a forex brokers hotline where you can ask for help choosing a forex broker that meets your individual fx trading needs. Interact on the same venue to discuss forex trading.

Forex News

The forex forum is where traders come to discuss the forex market. It is one of the few places where forex traders of all levels of experience, from novice to professionals, interact on the same venue to discuss forex trading. There is also the GVI Forex, which is a private subscription service where professional and experienced currency traders meet in a private forex forum. it is like a virtual forex trading room. This is open to forex traders of all levels of experience to view but only experienced currency tradingprofessionals can post.

Currency Trading

Currency trading charts are updated daily using the forex trading ranges posted in the Global-View forex database. You will also find technical indicators on the fx trading charts, e.g. moving averages for currencies such as the EURUSD. This is another forex trading tool provided by Global-View.com.

Forex Brokers

The forex database can be used to access high, low, close daily forex ranges for key currency pairs, such as the EURUSD, USDJPY, USDCHF, GBPUSD, USDCAD, AUD, NZD and major crosses, including EURJPY, EURGBP, EURCHF, GBPJPY, GBPCHF and CHFJPY. Data for these currency trading pairs dating back to January 1, 1999 can be downloaded to an Excel spreadsheet.

Forex Trading

Forex chart points are in a currency trading table that includes; latest fx tradinghigh-low-close range, Bollinger Bands, Fibonacci retracement levels, daily forex pivot points support and resistance levels, average daily forex range, MACD for the different currency trading pairs. You can look on the forex forum for updates when one of the fx trading tools is updated.

FX Trading

Global-View also offers a full fx trading chart gallery that includes fx pairs, such as the EURUSD, commodities, stocks and bonds. In a fx trading world where markets are integrated, the chart gallery is a valuable trading tool. Look for updates on the Forex Forum when the chart gallery is updated.

Forex Blog

Global-View.com also offers a forex blog, where articles of interest for currency trading are posted throughout the day. The forex blog articles come from outside sources, including forex brokers research as well as from the professionals at Global-View.com. This forex blog includes the Daily Forex View, Market Chatter and technical forex blog updates. In additional to its real time forex forum, there are also Member Forums available for more in depth forex trading discussions.

 

WARNING: FOREIGN EXCHANGE TRADING AND INVESTMENT IN DERIVATIVES CAN BE VERY SPECULATIVE AND MAY RESULT IN LOSSES AS WELL AS PROFITS. FOREIGN EXCHANGE AND DERIVATIVES TRADING IS NOT SUITABLE FOR MANY MEMBERS OF THE PUBLIC AND ONLY RISK CAPITAL SHOULD BE APPLIED. THE WEBSITE DOES NOT TAKE INTO ACCOUNT SPECIAL INVESTMENT GOALS, THE FINANCIAL SITUATION OR SPECIFIC REQUIREMENTS OF INDIVIDUAL USERS. YOU SHOULD CAREFULLY CONSIDER YOUR FINANCIAL SITUATION AND CONSULT YOUR FINANCIAL ADVISORS AS TO THE SUITABILITY TO YOUR SITUATION PRIOR TO MAKING ANY INVESTMENT OR ENTERING INTO ANY TRANSACTIONS.

Copyright ©1996-2014 Global-View. All Rights Reserved.
Hosting and Development by Blue 105