By: Barbara Zigah
The slide of the U.S. Dollar continues the 15-month downtrend in Sydney trading today, reinforced by the Federal Reserve stance to maintain the status quo. On Monday, the Chairman of the U.S. Federal Reserve Bank, Ben Bernanke, reported that key interest rates would remain at historic lows for the foreseeable future; meanwhile, Dallas Federal Reserve Bank president, Richard Fisher, acknowledged that the Fed’s commitment to low rates might create a carry trade issue, but that they were well aware of the risks involved. As reported at 5:41 p.m. in Sydney, the U.S. Dollar Index saw a slight gain of .1% to trade at 74.95 .DXY; in Monday’s trading, the DXY struck a new 15-month trough of 74.679 .DXY.
This week, market players are watching the outcome of the U.S. President’s trip to Beijing, though it appears most analysts aren’t expecting to see any changes to China’s current foreign exchange policy. The meeting between the U.S. and Chinese leader held no surprises, with no mention being made of the Yuan, nor China’s commitment to allow it to appreciate. Investors are also keenly watching the launch of mutual funds from Japan which is expected to trigger an outflow of Yen; many of the mutual funds focus on overseas assets, and offer a choice of currencies including the Australian Dollar, the Brazilian Real and the South African Rand.
U.S. Dollar edges up Off of 15-month Low, but Downtrend Continues
After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.