The US dollar remains weak across the board as traders await the FOMC monetary policy decision on Wednesday afternoon. Even after the 75 basis point rate cut to 3.5% last week, the market is still expecting a 50bp cut tomorrow. Gold traded at a record high of $930 per ounce. (more…)
US Durable good orders in December came in above expectations at 5.2%. Economists cannot agree on whether the Fed will cut 25 or 50bp after the better durable goods announcement. Retail sales in the UK continue to be disappointing and have decreased to the weakest point since November 2006. (more…)
The Dollar tumbled against major currencies except the Yen on Tuesday after the Federal Reserve unexpectedly slashed its benchmark overnight lending rate in an attempt to allay market fears of a US recession. The Fed’s emergency move to cut rates by 75bp precipitated the world stock markets weakness. Short-term interest rate futures were pricing in a 25bp rate cut at the Jan. 29-30 meeting and showed a roughly 80% chance of a 50bp cut.
The US central bank’s move wiped out the Dollar’s yield advantage over the Euro, with the federal funds rate target now at 3.5% and official euro zone interest (more…)
The Dollar rose on Friday as investors scaled back bets for another aggressive Federal Reserve interest rate cut this week and on optimism a $150 billion stimulus package would help support the US economy. US stocks extended losses and safe-haven Treasury bond prices rose, reflecting considerable uncertainty about the near-term outlook.
The Fed’s emergency 75bp rate cut last Tuesday, precipitated by sharp falls in global stocks, prompted investors to price in 50bp reduction from the US central bank at this week’s scheduled policy meeting.
A heavy data calendar awaits investors this week, inclu (more…)