Friday July 21, 2006 - 10:41:30 GMT
Share This Story
INVESTICA Ltd - www.investica.co.uk
Rate speculation hurts dollar
The US currency continued to edge weaker during Thursday, although the moves were relatively limited in cautious trading. The US currency was holding little changed in early Europe on Friday before retreating towards 1.2675.
The US Philadelphia Fed index weakened to 6.0 in July from 13.1 the previous month as the pace of orders slowed. The strengthening price components, however, illustrated the difficulties faced by the Federal Reserve in setting interest rates.
The FOMC minutes from June revealed that all members supported a rate increase and were concerned over the rise in core inflation. Some, however, considered the increase a close call given the probability of slower growth and the risks of tightening too far. Given that the data since then has suggested a slowdown in growth, there will be a high risk of a policy split at the August meeting. Market expectations of an August increase have already dipped to around 50% from 90% at the beginning of the week, but the dollar will still be vulnerable if expectations weaken further.
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."