Friday, July 17, 2009

Dollar Declines as Negative Economic Data Released

Thursday in forex market the US Dollar declined against its counterparts, as EUR/USD hit its high of 1.4150 level. The greenback depreciated against British pound and Japanese Yen.The reason of such a decline appeared to be the Long-Term Purchases report issued yesterday by US Treasury International Capital. This report includes the difference in foreign long-term securities purchased by USA citizens and U.S long-term securities purchased by foreigners. This time the figures appeared to negative as the balance is $19.8 billion. According to the released data Chinese investors are currently holding $800 billion US securities. The huge debt has raised concerns that it might have the potential to pull down the value Dollar in the long term outlook.
The Philadelphia Manufacturing Index, used to measure the economic conditions in the Federal Reserve district, was issued. The index reached a -7.5 mark, which means that the factory activity in the district has declined for the 10th consecutive month in July. According to forex analyses this report has boosted the greenback for further downfall.

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