Tuesday March 14, 2006 - 10:50:47 GMT
Share This Story
INVESTICA Ltd - www.investica.co.uk
Dollar faces key tests
The dollar was unable to reclaim the 1.19 level against the Euro during Monday and drifted back to 1.1960 again in New York. The pattern continued in early Europe on Tuesday with the Euro pushing slightly stronger to 1.1980 before dipping after the German ZEW report.
There will be greater caution over dollar buying ahead of important US data releases this week which could have an important market impact. The growth data is liable to be weaker than that released in February, especially with less favourable weather, and retail sales data will provide the first major test on Tuesday. The dollar will remain very vulnerable to any shift in interest rate expectations and the currency dipped slightly after Fed Governor Yellen stated that the Fed would need to be sensitive to the risks of increasing interest rates too far.
The United Arab Emirates central bank reported that it would increase the proportion of Euro reserves to 10% and, although the amounts involved are relatively small, the dollar will be more sensitive to poor current account data in an environment where there are market concerns over underlying reserve diversification and fears over US protectionist sentiment.
Forex Trading News
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
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."