News

Monday 19th May

Last Friday's plunge in May consumer confidence (Michigan sentiment index) saw the US dollar finish the week with a heavy offered bias as the market took the view that the Fed would find it difficult to raise US rates and the beleaguered consumer would dictate the future direction of the economy. The Aussie dollar climbed to a 24 year high late Friday but has given back some of this gain in the early hours of trading overnight. The future Trend for the dollar remains very much mixed with further falls expected if tomorrow's US PPI number reinforces worries about stagflation.

The spectre of inflation has risen over financial markets with oil at record highs and central banks balancing price fears with economic weakness.The problem now for CB's is how to lower interest rates to stimulate economies when prices are rising globally. More trouble ahead by the looks of it!