The US Dollar was marginally lower versus the Euro and other major currencies this morning. Reports that US FED Chairman Ben Bernanke was moving closer towards being confirmed for a second term didn't bode well for the dollar. Financial markets have been speculating since late last week about whether Bernanke would get another term. Several key senators have announced their opposition to Bernanke's reappointment.
This morning's trading could have also been technical weakness for the greenback, which incurred steep gains last week until a minor pullback began on Thursday. However, we think that demand for riskier assets and other higher-yielding currencies over the US dollar will continue to be soft this week as long as concerns over Greece's fiscal problems, China's economic tightening, and Obama'a bank overhaul continue. Concern over Obama's plan to reign in banks caused US stock markets to plunge on Friday and brought Asian markets lower this morning.
Coming Up Today:
News is light today, with the highlight being US December existing home sales at 15:00 GMT. Markets are eagerly awaiting the FED monetary policy statement on Wednesday. The Fed is widely expected to keep rates on hold (near zero), although it may sound more optimistic about an economic recovery, which would lend further support to the USD.