The U.S. Dollar and the Japanese Yen fell today as global stock markets rebounded and on the announcement that Citibank, the largest financial institution in the United States, was contemplating a merger with another financial institution to quell market anxiety.
According to Boris Schlossberg, a senior strategist at the New York based foreign exchange firm, GFT Forex, it appears that investors have reached a point where they believe they have reached the bottom, and that hope is reflected in the market today, in the form of high yielding currencies and equities. Also, Geoffrey Yu, a currency expert at UBS in London, believes that investors are cautiously “optimistic, but (should) not get carried away.”
The lighter mood in the markets encouraged investors to return cautiously to riskier assets, including commodities, equities and higher yielding currencies, including the Pound Sterling and the Euro.
In early trading in New York on November 21, 2008, the Euro was up by 0.9% against the U.S. Dollar and traded at $1.2575. The Euro rose by 1.8% to 119.22 Japanese Yen, while the Pound Sterling surged by 1.6% against the U.S. Dollars to $1.4964. The U.S. Dollar jumped by 1% to 94.90 Japanese Yen.