UFXBank Forex News: Pound Just Keeps Pounding the Dollar | Learn Forex | GoLearnForex.com

UFXBank Forex News: Pound Just Keeps Pounding the Dollar

Written by article default Monday, 02 May 2011 07:04

USD Dollar (USD) – The dollar fell against most of the major currencies due to both the U.S. debt widening, and the Federal Reserve signaling on April 27 that borrowing costs will remain near zero percent for an extended period. In Forex trading, the Greenback is the worst performer across the board, and is poised to close with losses against major competitors for a second consecutive week. The Chicago PMI came out at 67.60 vs. 70.60 previously. It is a positive result even though slightly lower than the one expected by analysts. Personal Spending came out at 0.60% vs. 0.90% previously. The Stock Markets closed the week positive as the Dow Jones rose by 0.37% and the NASDAQ rose by 0.04%. Crude Oil jump by 0.90% and closed at $113.50 a barrel. The main reason for commodities outperforming stocks and bonds is the weak dollar. In addition, amid concern that riots and conflict across northern Africa and the Middle East would disrupt supplies.  Gold (XAU) reached to an all time record, closing at $1576 an ounce after the U.S. Federal Reserve pledged to keep borrowing costs low, eroding prospects for the dollar and boosting demand for the metal as an alternative investment. But for now, Gold prices are currently below the mentioned high of $1548 due to rumors that Al-Qaeda leader Osama bin Laden has been killed, but is poised to close April posting a 9.23% gain. Today, the ISM Manufacturing PMI is expected to decline 59.90 vs. 61.20 previously.

Euro (EUR) – The euro traded unchanged against the U.S Dollar, reaching highest level since Dec. 2009 after hitting 1.4880. The pair rose, posting one of the biggest weekly gains since the beginning of the year. The Fed announcement that it will maintain the target range for the Fed Fund at record lows (at 0% - 0.25%), and the speculation that the European Central Bank may raise interest rates, make the Euro much more attractive. The pair is testing its resistance at 1.4870. Trading above the support level of 1.4750 keeps the momentum positive for the pair, but if the pair breaks below this support level, it might decline to 1.4550. Overall, EUR/USD traded with a low of 1.4492 and with a high of 1.4880. Today ECB President, Trichet is expected to speak.

EUR/USD – Last: 1.4790

British Pound (GBP) – The Pound strengthened against the Green back due to a weak dollar and tried to break again the resistance level of 1.6780.  The fact that the previous resistance level of 1.6620 provides support now is a strong bullish sign.  But if it breaks below, it could fall back to 1.6520. Overall, GBP/USD traded with a low of 1.6430 and with a high of 1.6742. Today BOE Governor, King Speaks.

GBP/USD - Last: 1.6675

Japanese Yen (JPY) – The dollar fell against the yen due to the Bank of Japan leaving its target lending rate in a range of 0 to 0.1 percent. The Bank raised its growth forecast for next year on optimism that the economy will bounce back on reconstruction work and restored power supplies. The world’s third-largest economy will expand 2.9 percent from the start of the year. The central bank announcements support the local currency against the US Dollar. On Friday, Tankan Non-Manufacturing came out at 3 vs. 1 previously. Today, no major economic data is expected.

USD/JPY-Last: 81.55

Canadian dollar (CAD) – The Loonie strengthened against the US Dollar after it tumbled following the release of economic data in Canada earlier in the day. The Canadian Dollar strengthened to test multi-year lows around the 0.9450 level. So far, it has been unable to break down lower but remains trading barely above the mentioned level, headed toward the lowest weekly close since November 2007. The Dollar lost momentum and fell on American hours, particularly against commodity currencies. Today, no major economic data is expected.

USD/CAD - Last: 0.9480