FOREX NEWS-Dlr recovers slightly but more weakness expected
Fri Nov 23, 2007 7:02am EST
(Changes byline, updates prices, adds quotes)
By Simon Falush
LONDON, Nov 23 (Reuters) - The euro set fresh record highs versus the dollar on Friday, but the $1.50 level proved out of reach as the euro was knocked more than a cent off its peak by comments from a euro zone policymaker.
Moves in currencies were amplified by thin liquidity in the wake of the Thanksgiving holiday in the United States on Thursday and with Japanese markets closed for a holiday on Friday.
ECB Governing Council member Miguel Angel Fernandez Ordonez said he saw a stronger than expected slowdown in the euro zone and that there was not enough data to dispel uncertainty about the effects of financial market turmoil.
Ordonez' comments reminded investors that the fallout from the credit crisis is not limited to the United States, where they have prompted 75 basis points worth of cuts in the fed funds rate since September and helped send the dollar to record lows.
The comments gave some respite to the dollar, which slid to new record lows versus the euro, the Swiss franc and a basket of major currencies earlier on Friday as investors raised their bets that the Federal Reserve will cut rates by at least another 25 basis points next month.
However analysts see few reasons for the resurgence in the dollar to last.
"The upward trend in the euro has been stable over the last three months and there is nothing in terms of data to say that this will turn around soon," said Johan Javeus, FX strategist at SEB Merchant Banking. "We expect the dollar to breach the $1.50 level soon."
By 1129 GMT the euro was at $1.4806, down a third of a percent on the day and well below the peak of $1.4966 set earlier in the session, according to Reuters data <EUR=>.
The euro showed little reaction to euro zone data showing faster than expected growth in the manufacturing sector but a sharper slowdown in services industry growth in November.
The Ordonez comments cheered stock markets, which like the idea of rate cuts as that reduces the cost of companies' debt and also makes equities a more attractive investment relative to government bonds.
The rise in equities (.FTEU3: Quote, Profile, Research) -- fuelled also by talk of merger and acquisition activity -- together with the sell off in euro/dollar helped drag the dollar up from 2-1/2 year troughs versus the yen <JPY=>.
At 107.90 yen however, the dollar is down more than 6 percent since the start of November and on track for its biggest monthly percentage fall versus the yen since early 2000.
The yen and the Swiss franc have both benefited in recent sessions as investors, worried about the fallout from credit market problems and the impact on the broader economy, remained averse to risk.
Worries about the fallout have been stoked by the Organisation for Economic Co-operation and Development, which warned in a report on Wednesday that overall losses caused by the U.S. mortgage market crisis could conceivably hit $300 billion [ID:nL2182159].
The dollar fell to a historic low of 1.0899 Swiss francs <CHF=>, before trimming losses a little to stand at 1.1024.
Australian elections on Saturday are likely to have limited impact on the Aussie dollar, analysts said.
"Regardless of who wins the Australian elections on Saturday, the AUD should remain driven by risk perception," said Dresdner Kleinwort in a note to clients.
The high yielding Australian dollar generally suffers when risk aversion increases. It is currently steady on the day at $0.8716. (Reporting by Simon Falush; Editing by Ron Askew)
Reuters journalists are subject to the Reuters Editorial Handbook which requires fair presentation and disclosure of relevant interests.
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
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."
Elevate Your Trading With The Amazing Trader!
The Amazing Trader includes:
Actionable trading levels delivered to YOUR charts in real-time.
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.
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.
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 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 Global-View.com.
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 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.
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.
Global-View.com 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 Global-View.com. 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.
WARNING: FOREIGN EXCHANGE TRADING AND INVESTMENT IN DERIVATIVES
CAN BE VERY SPECULATIVE AND MAY RESULT IN LOSSES AS WELL AS PROFITS. FOREIGN
EXCHANGE AND DERIVATIVES TRADING IS NOT SUITABLE FOR MANY MEMBERS OF THE
PUBLIC AND ONLY RISK CAPITAL SHOULD BE APPLIED. THE WEBSITE DOES NOT TAKE
INTO ACCOUNT SPECIAL INVESTMENT GOALS, THE FINANCIAL SITUATION OR SPECIFIC
REQUIREMENTS OF INDIVIDUAL USERS. YOU SHOULD CAREFULLY CONSIDER YOUR FINANCIAL
SITUATION AND CONSULT YOUR FINANCIAL ADVISORS AS TO THE SUITABILITY TO YOUR
SITUATION PRIOR TO MAKING ANY INVESTMENT OR ENTERING INTO ANY TRANSACTIONS.