User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Wednesday December 21, 2005 - 20:54:24 GMT

Share This Story:
| | Email

Forex: Dollar Rally Continues as Fed Official Remains Vigilant

DailyFX Fundamentals 12-21-05

By Kathy Lien, Chief Strategist of

• Dollar Rally Continues as Fed Official Remains Vigilant
• Market Shrugs off ECB Rate Hike Rumors
• Pound Slides as BoE Votes 8-1 to Leave Rates Unchanged

US Dollar

In another day of thin trading and Day 2 of the New York City Transit Strike, the dollar continued its impressive rally against the majors. The story remains very much the same – perhaps this may be reflective of the pre holiday relief rally, which is certainly something we are seeing in the stock market today. This may be particularly true since GDP for the third quarter was revised down from 4.3 percent to 4.1 percent. The price index and Core PCE were both revised higher, which confirms the inflationary pressures we saw throughout the quarter. However despite the downward revision, the pace of growth remains solid, which validates the market’s rather indifference towards the weaker report. For the most part, growth and other economic data still support at least one more rate hike early next year. The one in March remains far more uncertain, especially since it will be the first one that the rookie Fed Chairman Bernanke oversees. Fed President Lacker who is also a voting member of the FOMC was still solidly hawkish despite the modest shift in tone in the December statement. He said that the Fed needs to continue to “respond vigorously” to inflation expectations. He also believes that it is too early to say that the Fed has successfully tackled inflation. Meanwhile, we’ve got two more days of trading until the holiday week begins. If the transit strike in NY continues, we expect more thin trading conditions. Eurozone inflation reports and US durable goods orders could be of mild interest, but as we have seen throughout this week, fundamentals have been an unreliable indicator for price action in the dollar.


The Euro sold off for the third consecutive day against the dollar despite stronger French consumer spending numbers. In the month of November, spending accelerated by 1.1 percent compared to the market’s forecast for 0.5 percent growth. Spending for the month of October was also revised higher from negative 0.6 percent to negative 0.1 percent. The market also shrugged off rumors of more rate hikes by the European Central Bank. According to a report released by Reuters citing unnamed sources, the ECB could deliver another rate hike in March and September of next year. We remain skeptical of such specific dates, especially since no one knows exactly how the global economy will be doing six months from now. However, if growth does remain stable as the ECB expects, then two or three more rate hikes would be far from surprising. In fact, in our 2006 forecasts, we predicted that Eurozone interest rates could hit 3-3.25 percent by year end. Meanwhile we caught an interesting report by our friend Rhonda Staskow at IFRMarkets. She said that according to the IMF data released today, central banks are indeed shifting their reserves to Euros, albeit quietly. “The data shows that global forex reserves in 1999 were comprised of 54.7% in USD and 13.8% in the EUR. 2.2% were allocated in sterling with 4.9% in the JPY. In Q3 2005, 44.3% of reserves were in the USD and 16.2% in the EUR with 2.37% in Sterling and 2.4% in JPY.” The biggest shifts were in the holdings of India, China and Russia. We remind our readers that reserve diversification is similar to the current account deficit in that the issue is sure to resurface in the future and our neglect of it will ultimately catch up to us.

British Pound

A more dovish bias at the Bank of England has pressured the British pound for yet another day. According to the minutes from the latest Monetary Policy meeting, the members of the committee voted 8 to 1 to keep interest rates unchanged at 4.50 percent. Stephen Nickell was the one dissenting member who called for a quarter point rate cut. The market did not take this news well since it was expecting a unanimous vote. Although one member hardly puts us at risk for another rate cut anytime soon, recently dovish comments from Chief Economist Bean and skepticism by Barker could indeed set the stage for a second quarter dose of easing. However, as the BoE has repeatedly warned, any rate reductions would be made based upon the trend of economic data and so far, data has been very mixed. The CBI Distributive Realized Sales Balance jumped from -35 to 0, which is the strongest reading since February. Although the index has been very volatile, pound bulls are sure to have found it comforting.

Japanese Yen

The Japanese Yen ended the day unchanged against the dollar, but higher against most of the other majors thanks to mildly hawkish minutes from the October 31 and November 17-18 monetary policy meetings. According to the minutes, two members of the committee, Mizuno and Fukuma voted both times against leaving the current account target balance unchanged. Instead, they both separately voted in favor of cutting the current account target and even though their two votes had little sway in overall policy, it shows the gradual shift in bias by the members of the central bank. Ultimately, the BoJ will be rooting for an end to their zero interest rate policy next year. However it remains to be seen whether the government will agree.


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