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Status of the American currency on the Forex market remains extremely volatile

Oct 7th, 2009 | By admin | Category: News International Markets

Status of the American currency on the Forex market remains extremely fragile. The dollar continues to face serious pressure, despite the stream of negativity, which is considered by many analysts, provoking flight risk. Despite this, in recent days on the market once again possible to observe the retreat of the dollar. So, yesterday, 6 October, the dollar came under attack in connection with the emergence of rumors about the beginning of some negotiations a number of countries, the gradual replacement of the U.S. dollar basket of currencies. Another attack on the dollar was the unexpected decision of the Reserve Bank of Australia interest rate, which, we recall, was contrary to expectations raised to a mark of 3.25%. It is also worth noting that the Bank of Australia became the first chief of the Central Bank, which went to raise rates, though, and so has the highest level.

However, after such a sudden action by the Australian has learned that the Fed is also ready to go to increase the level of rates. In the accompanying commentary also indicates that, despite the possible increase in interest rate policy of the Federal Reserve would remain committed to further stimulate economic growth. The most prominent advocate of increasing the level of interest rates is the president of the Federal Reserve Bank of Kansas City, Thomas Hoenig, who, however, has no right to vote in the committee on operations on the open market. Nevertheless, while sentiment in reserve rather soft, and any possible increase in time to call is difficult.

Another factor that has had a positive impact on the position of the U.S. currency, were news from the U.S. administration. The Government, in particular, noted that it will continue to provide strong financial support for further economic recovery, which should lead to a strong demand for U.S. assets. After these statements, the market expects a positive report from the leading corporations of the country, a series of publications which begins on Wednesday 7 October. The first of these companies will become the corporation Alcoa, which will report on the profit for the III quarter.

Among other important news is expected today publication of data on the dynamics of GDP growth in Europe for 2 quarter 2009. Recall that according to forecasts, analysts expect a neutral statistics. However, in view of recent events is not excluded that the data again disappoint the players.

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