Monday, November 13, 2006

 

US Dollar Rises As Rumors Dismissed

Forex News reports on the US Dollar. "The dollar pared its loss as the concern on China's Central Bank diversify its foreign exchange reserves away from the U.S. dollar fades. The dollar gained from nearly 1.29 to 1.28 against the euro and climbed more than 1 cent to above 118 versus the Japanese yen."

The Sydney Morning Herald. "The Australian dollar opened about half a US cent weaker today, after price of lead tumbled and the US currency flexed its muscle overnight. 'It looks like the commodity currencies underperformed on the night,' ICAP chief economist Michael Thomas said. 'The US dollar seems to have had quite a good run, heading north through the entire session.'"

"Mr Thomas said the US unit may have been boosted by comments from a Japanese ruling party politician overnight. Shoichi Nakagawa, the ruling Liberal Democratic Party policy chief, said in a media report that he was against the Bank of Japan raising interest rates."

"On the local interest rate front, National Australia Bank currency strategist John Kyriakopoulos said yield support for the domestic unit had diminished as expectations for another hike were pared."

From MarketWatch. "Gold futures fell Monday to close with a loss of more than $4 an ounce, as crude prices continued to decline and the U.S. dollar firmed ahead of key economic data this week. 'The feel of the market is not one of holding itself up, but one of preparing to run,' said Julian Phillips, an analyst at GoldForecaster.com. 'This is more consolidation at higher levels as the market is settling into the low $600s.'"

"Gold for December delivery closed down $4.30 at $625.80 an ounce on the New York Mercantile Exchange after reaching a low of $621.50. The contract lost $6.70 an ounce on Friday, a day after it hit a two-month high when comments from the head of the Chinese central bank confirmed plans to diversify the country's foreign reserves."

"On Monday, China's State Information Centre, a think tank, said in a report in the China Securities Journal that China should diversify its foreign-exchange reserves by building up strategic reserves of crude oil, important metals and bulk commodities.
'This is the usual remark from this source and it ultimately had little impact,' according to analysts at research firm Action Economics."

"'Now that rumors of presumptive gold acquisition by China have been relegated to the fairy-tale shelf, gold can make progress and work on facts,' said Jon Nadler, an analyst at bullion dealers Kitco.com. 'Diversification resources such as the euro and the yen are still very much in the cards not only for the Chinese central bank, but for anyone else concerned about the cumulative effects of the tremendous deficits piled up over the past five years in the United States,' he said."

"Other metals also closed lower Monday. December silver fell 23 cents to close at $12.885 an ounce; January platinum lost $5.70 to end at $1,203.90 an ounce; and December palladium closed off $3.95 to $326.75 an ounce."

Comments:
Lets hope the dollar stays weak... Planning a trip to the US soon!!
 
Rumors dismissed? How? By whom? Did traders expect the Chinese to dump $1 trillion of bonds on the market today? Give me a break. I don't think the USD is the Titanic. If it has to be a boat, the USD is the Flying Dutchman, adrift forever.
 
Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?