US Dollar 15 year lows

With the US dollar trading at a 15 year low against the Japanese Yen, one would hope that the US will step in and support their buck; but such intervention may be someway off yet.. Why ? because the US has enough to worry about at the moment and no 1 on the agenda is the economy. On Tuesday the Fed announced that it would use cash from mortgage bond’s maturing to buy T-bonds, thus keeping borrowing costs low.

This in turn reduces the urgency of any interest increases, indicating some substance to a double dip recession. With little support to the US dollar right now current levels of 84 yen for every dollar are unlikely to be sustained, with expectations of a breach of 79.75 Yen, the all time low of this currency pair seen in 1995. Not forgetting that a week dollar is also great for US exports – item 2 on the US agenda…

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About Simon Brown
Simon Brown has over 20 years experience trading Derivatives on everything from Gold, FTSE to Dollar/Pound. Simon has lectured in Trading Psychology, Strategy and Technical Analysis, in addition to regular appearances on CNBC television. He is now Managing Director of ProSpreads.

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