Thursday, July 30, 2009
Dollar Continues Strengthening
The US currency continues gaining versus its main counterparts. Yesterday it came close to its 2 week high against the Euro. It also rose against the Pound and Yen.
The reason of such appreciation is a better than expected Core Durable Goods Orders monthly report accompanied by China`s statements that it will keep on maintaining loose monetary policy. It seems that investors were impressed by the 1.1% rise in the Core Orders during June. The difference between the two reports is that the Core report measures the change in the total value of new purchases orders placed with manufacturers for durable goods, excluding transportation items. Orders for aircraft are known to be very volatile, and thus have the potential to distort the underlying trend.
Traders usually tend to pay more importance to the Core report as purchases orders placed with manufacturers for durable goods such as orders for aircraft are known to be very volatile. This report shows signs of positive growth, for the third straight month making investors believe that the global recession is coming to the end.
Among today`s news in economic calendar the main release from the U.S economy looks to be the weekly Unemployment Claims report at 12:30 GMT. Currently, while all the major economic indicators of the U.S economy are showing signs of recovery, it is only the job sector which goes on producing negative results.