The Dollar's rise not over yet says Lehman
Finotec | Aug 25, 2008 08:00PM ET
slowing exports will stop the European Central Bank from raising the interest rate this year
| EUR/USD | USD/JPY | USD/GBP | USD/CHF | |
|---|---|---|---|---|
Resistance | 1.4860 1.4780 1.4715 | 111.00 110.65 110.30 | 1.8625 1.8590 1.8470 | 1.1200 1.1170 1.1105 |
Support | 1.4475 1.4440 1.4420 | 109.00 108.65 108.15 | 1.8305 1.8170 1.8090 | 1.0995 1.0925 1.0845 |
The euro fell for a third day against the dollar on a report today that showed business confidence in Germany slumped to a three-year low. ``There's a good chance for the euro to go lower,'' said Tsutomu Soma, a bond and currency dealer at Okasan Securities Co. in Tokyo. ``People are giving up on bets for euro gains as the chance of an ECB rate hike fades away.'' The euro also declined today versus the yen on concern credit-market losses and slowing exports will stop the European Central Bank from raising the interest rate this year. The current interest rate stands at 4.25%. The EUR/USD is currently trading at $1.4601 as if 8:18am, GMT. EUR/JPY trading at 160.51.
The dollar's rally over the past month is ``close to unprecedented'' in the 35 years since the currency was decoupled from gold and will have room to rise on bets the European Central Bank will begin cutting borrowing costs, according to Lehman Brothers Holdings Inc. ``The ECB is going to start cutting early next year -- in January,'' said Steven Englander, a currency strategist at Lehman in New York. ``Right now, the first ECB cut isn't priced in to the market until July. We are significantly more aggressive in terms of thinking how the ECB is going to respond to weaker growth and lower inflation.''
The UK pound is falling against the dollar after a report showed economic growth stagnated in the second quarter. The report added to pressure on the Bank of England to set aside concerns about inflation and cut its benchmark interest rate which is currently at 5 percent. BBA Mortgage Approvals come out slightly better than expected at 22.4K from an expected 21.1K. The GBP/USD is currently trading at $1.8390 as of 8:24am, GMT.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.