The US dollar continued to fall against the safe haven yen and Swiss franc in overnight trading, as the widespread political unrest in Libya has driven investors away from riskier currencies. Confidence in the pace of the global economic recovery has been severely dampened, causing the dollar to drop against several of its main currency rivals. The USD/JPY has fallen almost 75 pips from yesterday's high of 83.40. Currently the pair is trading around the 82.60 level. The USD/CHF has dropped well over 100 pips in the last 24 hours, and is currently trading around the 0.9370 level.
Turning to today, a lack of significant news out of the US means the dollar is forecasted to remain bearish. That being said, traders will want to pay attention to the US Existing Home Sales figure, set to be released at 15:00 GMT. Analysts are predicting today's figure to be slightly below last month's. If true, investor confidence in the US economic recovery may remain low, and the greenback could take further losses in afternoon trading.
In addition, traders will want to pay attention to any news out of Libya, as the conflict there continues to impact investor attitudes toward the current state of the global economy. Further unrest in the Middle East is likely to cause the dollar to tumble further.