The dollar is in knockdown…Rate dynamics and recommendations on EUR-USD and GBP-USD.
17:48 08/09/2004
The dollar is in knockdown…Rate dynamics and recommendations on EUR-USD and GBP-USD.
On Friday, bulls got knocked down on the dollar at the exchange market, as well as on NYSE stock exchange in New York after the release of Labor market data. Nonfarm payrolls came out unexpectedly negative and almost seven times lower than expected. Nonfarm payrolls in the U.S. in July made up +32000 (forecasted as +220000, previous value was revised from +112000 to +7800). That made the Euro leap more than 250 points higher in an hour’s time. The given event was not that negative for the stock exchange market, as in this case FRS rate hike is under a question. As a rule, low rates stimulate production and produce good effect on the stock exchange. As for the exchange market, rate hike is always a positive factor for the rate of the national currency. That is why negative Labor market data might be not the last negative for the dollar. It is difficult to say what decision upon the rate the FRS will make at its regular meeting on August 10.
Oil market continues to affect the dollar in a negative way. Prices reached a record level of $44,7 a barrel for light crude and almost $42 a barrel for Brent crude in New York at NYMEX.
Recommendations: market is in apathy, so it is better to stay out of the market and wait for safer signals.
Recommendations: market is in apathy, so it is better to stay out of the market and wait for safer signals.
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