Tuesday, December 1, 2009
The U.S. Dollar continued to weaken overnight against most major currencies after China announced that its manufacturing sector rose to a seasonally adjusted 55.7 last month. This
growth rate was the fastest pace in five years or since the index began being tracked.
Talks continued in Dubai to shore up its debt woes. Traders are continuing to chip away at last week’s losses in the foreign currency and equity markets as they grow more confident
that this issue is a local problem rather than worldwide. Officials are defining the talks with creditors as “constructive”. As this situation improves, investors are stepping up demand for higher
yielding currencies and assets.
The December Euro is up again overnight and in a position to challenge yesterday’s high at 1.5084. Upside momentum is building which can trigger a further rally to the high for the
year at 1.5144. Later this week, the European Central Bank is set to meet. Traders expect interest rates to remain unchanged, but ECB members will make announcements regarding the gradual ending to
government stimulus plans.
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