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UFXBank Forex News: Soros Sells Gold on Inflation Fears

Written by article default Monday, 09 May 2011 08:17

USD Dollar (USD) – The Dollar strengthened versus the other major currencies after George Soros's hedge fund started selling its Gold holdings on speculation he no longer sees a big threat of deflation. Friday also saw the release of the Nonfarm payrolls, which came out at 244K, better than the expected 185K. The Unemployment Rate came out at 0.900%, worse than the expected 8.80%. Treasury Secretary Timothy F. Geithner will urge China to allow higher interest rates when he meets with Chinese leaders this week, as the U.S. extends its push for a stronger Yuan. The NASDAQ and Dow Jones rose by 0.46% and 0.43% respectively. Crude oil plunged by 5% as commodities dropped the most in two years on concern that economic growth will slow. Crude closed at $97.80 a barrel. Gold (XAU) rose by $16 and closed at $1490.85 an ounce. Today no major economic data is expected.

Euro (EUR) – The euro rose in Forex trading against the dollar and yen on prospects that the region’s debt crisis won’t keep the European Central Bank from increasing interest rates further. The EUR/USD‘s momentum became very negative owing to the recent weakness of the Euro. As long as the rate is below 1.4500, the pair will probably continue to decline. Overall, EUR/USD traded with a low of 1.4314 and with a high of 1.4587. Today, the German Trade balance is expected to strengthen from 11.40B to 12.50B.

EUR/USD – Last: 1.4398

British Pound (GBP) – The Pound weakened last Friday against the Dollar after the Bank of England kept its main interest rate at a record low of 0.5%. Adding to the Pound's weakness was panic in the commodities and stock markets, which pushed investors to stick with the Dollar. But during the Asian session, they became less pessimistic as the U.K first time homebuyers housing price outlook and rose during the night, carrying the Pound with it. The next resistance level of the GBP/USD on the daily chart is located at 1.6420. As long as the pair is trading below this level, the Pound is likely to continue to decline. Overall, GBP/USD traded with a low of 1.6353 and with a high of 1.6463. Today, no major economic data is expected.

GBP/USD - Last: 1.6391

Japanese Yen (JPY) –The Yen fell against the dollar last Friday as did the other major currencies. The USD/JPY is facing resistance at 80.70 on the daily chart and as long as the pair is below this resistance level, the momentum will remain bearish. Once the pair breaches this resistance, it might jump to 81.40. Overall, USD/JPY traded with a low of 80.04 and with a high of 80.83.

USD/JPY-Last: 80.55

Canadian dollar (CAD) – Canada’s dollar fell the most since July against the greenback as crude oil, the nation’s biggest export, tumbled on concern that the global recovery is stalling. As long as the pair is trading above 0.9600 levels, the US Dollar is more attractive and the next resistance level on the four hour chart is located at 0.9700 levels. Overall, USD/CAD traded with a low of 0.9568 and with a high of 0.9712. Today, Housing Starts are expected at 183K vs. 185K previously.

USD/CAD - Last: 0.9617