Earlier the ECB decided to leave interest rates at 4% while the Feds is expected to cut its benchmark overnight lending rate by at least 50% points during this month as it fights to stave off an economic recession in the US. The truth is that as data continues to point to a deteriorating economy, no one wants to support the dollar right now because we all know that Bernanke will cut interest rate no matter how inflation pressure grows.
Meanwhile, the greenback tumbled to a low against the euro after comments from European Central Bank President Trichet stating that inflation risks are on the upside and hence dashing hopes of a cut in interest rates I the near future, dragging the pair with it to the upside to record a high of 1.5372 and a low of 1.5272.
Elsewhere, the pound rose against the dollar as gains in stocks drove demand for high yielding currencies for so called carry trades. The pound advanced further more above the $2 level mark after Bank of England's rate decision in which interest rates were kept unchanged.
Moreover, the dollar fell against the yen today as worries about a further downside risks to the currency amid expected weak US data pushed the greenback lower. Consequently, the pair was pushed to the downside to record a low of 103.07 after recording a high of 104.00
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