User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Friday September 16, 2005 - 21:13:34 GMT

Share This Story:
| | Email

Dollar Rallies on Expectations that Fed will Deliver Another Quarter Point Rate Hike

DailyFX Fundamentals 09-16-05

By Kathy Lien, Chief Strategist

· Dollar Rallies on Expectations that Fed will Deliver Another Quarter Point Rate Hike
· Euro Traders Zero In on German Elections
· Dollar Yen Breaks Higher on Greenback Strength

US Dollar

It has been an exceptionally strong week for the dollar. The greenback has managed to gain strength against most of the major currency pairs despite a batch of mixed economic data. Over the past week, we learned that inflation, particularly core inflation for the month of August was much softer than expected, suggesting that the rise in energy prices may actually have a deflationary affect on the prices of other products. Headline retail sales, industrial production, jobless claims, consumer confidence, and the manufacturing sector surveys from the Philadelphia and NY region all pointed to weaker conditions in August and September. It was the more backward looking or delayed releases such as the trade (July) and current account balance (Q2) as well as the Treasury International Capital flow report (July) that exhibited signs of strength. The market however has chosen to focus on the older data this week rather than the more current ones, leading to a 210 pip rally in the dollar against the Euro. With no significant data releases due out of the US on Monday, the FOMC rate decision on Tuesday afternoon has the market’s undivided attention. At this point, a quarter point rate hike to 3.75% is a near certainty. Of the 1130 people who participated in the DailyFX interest rate poll, only 10% of the respondents expect interest rates to remain at 3.50% at year end, while 40% expect interest rates to be increased only 2 more times this year. As we have previously mentioned, the Federal Reserve is probably in “information-gathering” mode as they assess how much of an impact Katrina has on US jobs and the economy as a whole. Meanwhile, the economic data released this morning was very mixed. The current account deficit and the University of Michigan consumer confidence number both came in worse than expected. Yet the sharp rise in net foreign purchases of US assets negated any pessimism. The market had anticipated foreign purchases of US assets to increase by $60 billion in the month of July but instead, it increased by a whopping $87.4 billion. This is more than enough to fund the same month's trade deficit of $57.9 billion and should relieve any fears that foreign demand is waning. It is important to note that the strong inflows were primarily from the private sector and public.


Weak data released overnight has the euro struggling to gain strength. The French current account deficit increased three times the amount expected while industrial production growth for the Eurozone slowed in the month July. However the elections in Germany is the pain focus this weekend and could potentially set the tone for trading on Monday. The race between Schroeder and Merkel’s parties are extremely close and with the elections in Dresden postponed for at least another 2 weeks, political uncertainty in the Eurozone’s largest country could remain for several more weeks. The current belief is that if the centre right parties fail to capture a majority, we could see the Euro extend its recent slide.

British Pound

Adding to notions that interest rate cuts may be a foregone notion, contrary to yesterday’s retail sales data, were statements released by Bank of England policy maker David Walton. Yesterday’s retail sales, relatively unchanged after declining 0.6 percent in the previous month, sparked speculation of interest rate cuts as consumer spending remains sluggish at best with retailers struggling to keep market share and individual demand alive. However, the slowdown in consumer spending may not be as cursed a notion as some may consider. According to Walton, although individual consumption remains “subdued” amid rising energy costs and sliding housing valuations, it may indeed curb current inflationary pressures that have been driven to an eight-year high. Annual inflation rose to 2.4 percent in August, above the central bank’s 2 percent benchmark target. Additionally, the policy maker added that the current rate of price increases should be “kept in perspective’ with oil shocks being temporary and the effect limited on future wage growth. In line with similar statements by Mervyn King, the statements suggest that although central bankers remain hawkish, consumer spending does remain a consideration on near term rate decisions with a realization that current energy spikes can be considered temporary shocks. However, as mentioned before, the effects of energy prices still remain questionable as we head into the fall and winter season. Notably, both seasons are known to drive prices higher.

Japanese Yen

With a lack of economic data today, traders bid the yen lower as interest shifted towards its greenback counterpart throughout most of the session. However, as we close the overall week, optimism still remains lofty in light of relatively weak economic data, i.e. dips in industrial production and overall household spending compared to incremental increases in consumer confidence. The key here contributing to overall optimism looks to be stemming from central bankers’ suggestions as well as mounting foreign interest, that things may significantly turn for the world’s second largest economy. Notably, this interest looks to be reflected in recently exploding investment capital in Japanese equities. Subsequently, the Nikkei has vaulted higher through the 12,000 level in a matter of months and now remains slightly below after testing the 13,000 figure. This leaves the benchmark index higher by almost 13 percent for the year, adding to yen strength. Additionally, with financial reform on the way, consumers may be ready for another bout in underpinning overall expansion as Vice Finance Minister Koichi Hosokawa calls on the central bank to maintain an “appropriate” monetary policy. Ultimately, the only fear that remains is a further rise in energy prices. With oil prices calmer on OPEC demand forecasts today, further near term waning crude interest will likely see uninhibited interest in the yen against the current staid range that is being witnessed.


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."

Actionable trading levels delivered to YOUR charts in real-time.

Register To Test Your Amazing Trader

GVI Trading. Potential Price Risk Scale
AA: Major, A: High, B: Medium

Tue 17 July 2018
AA 08:30 GB- Employment
A 13:15 US- Industrial Production
AA 14:00 US-Powell Testimony
Wed 18 July 2018
AA 08:30 GB- CPI
A 12:30 US- Housing Starts/Permits
AA 14:00 US-Powell Testimony
Thu 19 July 2018
AA 1:30 AU- Employment
AA 08:30 GB- Retail Sales
A 14:30 US- EIA Crude
A 12:30 US- Weekly Jobless
Fri 20 Jun 2018
A 12:30 CA- CPI/Retail Sales

John M. Bland, MBA
co-founding Partner,

Global-View Affiliate Program

We are starting an affiliate program to market some of our products.

Send me an email if you would be interested or if you know someone who would like to be an affiliate. Generous commissions payout for those accepted.

Put the word "affiliate" in the email subject line.

Contact us

Start trading with forex broker Markets Cube

Max McKegg's Daily Forex Trading Forecasts

Veteran FX Trader, Max McKegg, forecasts all the Major currencies and the Australasians; providing Daily and Medium Term Trading forecasts to subscribers, who include large Banks the world over, as well as individual traders in more than 30 different countries.

Request a TRIAL of Max's Forex Service.


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

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 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 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.



By using this website, you are agreeing to our Privacy Policy and Terms of Use, and Cookie Policy

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