Exchange rate euro and the future of euro are in the tenacious hands of dollar

Exchange rate euro / dollar will not grow

In brief: Forecast exchange rate of dollar and euro remains dependent on the problems of the European economy and the position of the UK.

Despite the increase in stock indexes, the American currency has maintained stability, because investors do not hurry to build positions in risky assets. This is especially true of European currencies, where the euphoria about a package of assistance measures in the euro zone was replaced by concern about the prospects for economic growth. The positions of the U.S. dollar has not changed significantly in trading on Wednesday. At the same time EUR / USD pair remains slightly above the 1.2600 mark, the pair GBP / USD once again failed to overcome the 1.5000 mark, and the pair USD / CHF is trading around 1.1100 marks.

Japanese yen is stable against other currencies. When the pair USD / JPY remains in the area of 93.00 marks, while the pair EUR / JPY rebounded to 118.00. Commodity currencies strengthened slightly against the U.S. dollar. Thus, the pair AUD / USD has remained below the 0.9000, the pair NZD / USD ranged below 0.7100, while the pair USD / CAD has continued to decline gradually towards the 1.0100 mark. Most European countries, including Britain, would be forced to make significant budget cuts, which in turn will lead to stagnation in the economy. The probability of rate hikes in the eurozone and the UK this year, remains extremely low. In fact, maintaining rates at a low level was confirmed in a speech by Bank of England after the publication of a report on inflation for the I quarter. In his speech, he very carefully evaluated the prospects for the economy, stressing the need to seriously reduce the budget deficit. This greatly influenced the attitude of investors to the British currency, which it lost won positions after the publication of encouraging data on the state of the labor market. Preliminary data on the eurozone GDP in the I quarter, despite the relatively positive, also failed to show strong support single currency. Other major currencies, including the currency of the commodity sector, also come to terms without significant changes, despite the fact that they still retain the tendency to rise against the U.S. dollar. Published data on trade balances U.S. and Canada, as expected, had no effect on the relevant currency.

Today is expected to reach a large number of new macroeconomic data. In the U.S., will present data on applications for unemployment benefits and the price index for imports. In Britain today would be known as the latest data on the trade balance. Other important indicators will not be published. At the moment the market reigned tense, and investors are mostly adopted a waiting attitude. This lack of data, most likely, will not contribute to building activity and the major currencies are likely to be traded without significant changes. However, any unexpected news, positive or negative, can lead the market from the current state, provoking another burst of volatility. Investors will closely monitor developments in the euro area and other regions, and receipt of unexpected news can lead to another surge of volatility in the market.

Ukrainian Globalist
2010-05-13 07:39, Currency news.

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