Forex - Dollar edges up in year-end profit taking
An unexpected fall in a US Mid-Atlantic manufacturing activity index weighed on the market already pressured by a persistent credit crunch and prompted investors to avoid risky carry trades.
Concerns that the credit fallout was spreading to other market segments mounted late Wednesday, with Standard & Poor’s revising its outlook downward for major bond insurers Ambac Financial Group, MBIA Insurance Corp and XL Capital Assurance. Yesterday, MBIA, the world’s largest bond insurer, said it had exposure to $30.6 billion in complex mortgage securities that it ensures, an amount that exceeds its en ire net worth.
Bear Stearns reported the first quarterly loss in the company’s history of $854 million, and took a write-down of $1.9 billion in the quarter ended November.
GbpUsd hit four-month low, having broken below the key 2.0000 mark the previous session after minutes from a Bank of England meeting suggested it may cut rates again as soon as January. In contrast, expectations of Federal Res