Thursday February 2, 2006 - 06:34:55 GMT
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Tricom Futures and Foreign Exchange -
Forex: The USD retains its lustre, as the ECB moves at a snail's pace
The US dollar was firmer against the major currencies early today, and was expected to maintain support as traders price in further rate increases by the US Federal Reserve following Tuesday's hike.
The dollar was bought overnight as US bond yield's jumped, with investors pricing in further rate hikes on positive US economic data while euro zone data was slightly weaker.
The market has further digested the FOMC and has come to the conclusion that the Fed will raise rates further, and that the ECB will raise rates slower than first thought. But then again, this may change next week.
For the moment, we have to go with it, and buy the USD (as much as it hurts me). This is going to turn, but we may not see it happen till after Easter, and most certainly by the middle of the year.
Today's Economic Release:
EU: ECB Meeting
US: Weekly Jobless
Today's Top Trades
- Sell EUR/USD around 1.2070, with stops above 1.2115
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