The dollar continues to hold its positions after record-breaking weak report on Trade balance of the USA.

According to the report of Department of Commerce, published yesterday, trade deficit of the USA again updated historical tops on a background of record growth of import, caused by oil prices. Details of the report showed politically sensitive trade deficit with China also was at a record mark $22 billion in comparison with $19.6 billion in July.

In August trade deficit made $69.9 billion, having increased 2.7 % in comparison with July value $68 billion which also was record. Analysts basically expected insignificant narrowing of deficit (up to $66.7 billion, according to Bloomberg News forecasts). So sharp deterioration of parameters of deficit recently is caused first of all by growth of the world oil prices.

Expansion of trade deficit happened even contrary to that fact that export of goods and services from the USA was up 2.3 % to record value $122.4 billion. Unfortunately, this gain was neutralized by import growth 2.4 % to $192.3 billion, that is also a record.

The dollar is supported by expectations of increase of FRS rate at FOMC meeting, which should take place in the end of current month.

Chicago FRB President Michael Moskow declared yesterday that for FRS monetary heads itcan be necessary to raise discount rates for the further decrease in rates of inflation. It became already, at least, the fourth FRS representative which expressed since October, 4th against idea of decrease in rates.

"My current estimation is that the risk of preservation of too high rates of inflation exceeds risk of excessive delay of economic growth", - Moskow told today, acting in "Four Seasons Hotel" in Chicago. Moskow has no vote in FOMC this year.

The dollar received support as well after the publication of FRS report on current conditions in economy - Beige Book.

Growth of consumer consumption and demand in service sector was accelerated in September, even despite "large-scale cooling" in housing market that can be considered as a sign of the future "soft landing" of the American economy.

The majority of 12 FRS regions informed on "not numerous signs of the increased price pressures" while the processing sector of the industry "as a whole showed high parameters", and a labor market "remained in the good shape".

This report followed statements of FRS representatives who in some last weeks actually denied expectations of drop in discount rates in the first quarter, 2007. The report of FRS meeting published yesterday from September, 20th showed that the monetary management of the American Central Bank sees a great risk of that inflation will not decrease so as they predicted.

As a whole position in the market develops in favor of dollar, yesterday's fundamental data did give an opportunity to enter the market, today we remain outside the market