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While Europe continues to struggle with its troubling debt crisis, the US released some encouraging data last week which could improve its economic outlook and shrugged off the fears generated from China’s decision to raise rates.
Chinadecided to raise its interest rates and the reserve requirements in an attempt to tame inflation, which fueled fears of slower economic performance in the region, dragging most of the Asian stock markets down and the yen higher.
The euro fell today as the sovereign credit crisis is worsening. Greece is believed to be on the way to restructure its debt, although the government keeps denying that, however it’s the same government that last year told investors it’s not looking for a bailout.
The combination of global inflation concerns and risk aversion trading brings gold to new highs. Today the shinny metal recorded a new record high at 1488.55 dollar per ounce, dragging with it the AUD near its record highs.
As the dollar index rose considerably since this morning, surpassing the 75 level, oil was pushed slightly lower, yet remains above the 108 dollars per barrel level, fueling fears over its negative consequences on the global recovery.
Major economies lack major economic data today; therefore, trading will be influenced by the uncertainties that could determine investors to be cautious and prevent them from taking risky new positions.
Originally posted here
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