Wednesday July 18, 2007 - 10:46:54 GMT
Share This Story
INVESTICA Ltd - www.investica.co.uk
Dollar faces key 24 hours
The inflation and housing data, coupled with comments from Fed Chairman Bernanke, will be very important for the dollar on Wednesday and the US currency will need a firm and confident Fed testimony to make strong headway.
The dollar weakened to lows around 1.3830 in European trading on Wednesday as sentiment remained weak.
There were further fears over sub-prime lending and these fears overshadowed the strong capital inflows data for May. Long-term capital inflows increased to US$126.1bn from US$80bn the previous month as strong corporate flows persisted
The consumer inflation data will be watched closely on Wednesday and an elevated reading for core prices would increase Federal Reserve unease over underlying inflation trends, especially as energy prices have risen strongly since the June data was compiled.
Concerns over the housing sector will persist, especially as the NAHB housing-market index fell to 24 in July from 28 previously, the lowest reading for 26 years. These fears will intensify if there is a further significant decline in housing starts.
Given uncertainties over economic direction, comments from Fed Chairman Bernanke will be watched closely on Wednesday. If Bernanke focuses on the inflation risks then the dollar will tend to gain ground while greater concern over the housing sector would tend to undermine the US currency.
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."