Tuesday, August 11, 2009

Dollar Extends its Gains against the EUR and Pound

Yesterday`s trades were marked with USD appreciation versus European currencies such as EUR and GBP. Monday the Dollar Index, showing the Dollar position against 6 most traded currencies performed an increase of 0.4% hitting a 79.31, second consecutive week`s rise. Last week the index added 0.8 percent. Adding to the Dollar gains yesterday was the increased speculation that in the long run, the U.S. economy will probably grow at a faster pace than the Euro-Zone, Britain and Japan.

The USD's bullishness vs. the EUR continued yesterday. The rate reached its low at 1.4130 level. GBP/USD pair ended trades with a massive drop by 235 pips hitting the low of 1.6475 as a result of British banking woes revived.

Among today business events many news will come from the US economy including the release of Prelim Nonfarm Productivity and Prelim Unit Labor Costs data both at 12:30 GMT, and Wholesale Inventories at 14:00 GMT.

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