Does this sound familiar? You’ve learned to trust your instincts. You’ve learned to trust your judgment. You value your independence and the accomplishments it has brought. Most things work out best when you do them yourself. And your experiences trusting others to do things for you are mixed at best. That sounds like me, and I’ll bet it’s a familiar tone for many of you. As consumed as we are by daily professional life, we still want to be in charge of...
Commentary: 2006, the year that was
February 16, 2007 on 1:02 pm | In |
The books have been closed on 2006 for more than a week, which means it is time for the forex blogger to give his first-ever state of the markets address. After a dull and static 2005, forex markets roared back into action in 2006, with several notable developments. On everyones radar screens, the worlds most important currency, the USD, declined by over 13% against the Euro and the British Pound. Analysts attributed the decline to narrowing interest rate differentials between the US and the rest of the developed world, as the US monetary cycle peaked while the rest of the world continues to raise rates.
In addition, several countries, notably China, Russia and several OPEC nations announced that they had already begun to diversify their foreign exchange holdings. This process is becoming auto-catalytic, which means that as the USD declines, it makes less financial sense for Central Banks to hold USD-denominated assets, which causes the USD to decline further, and so on. Meanwhile, the US economy is sputtering, and a majority of economists believe the Federal Reserves Bank will lower interest rates in 2007.
The Yen initially joined the ranks of the Pound and the Euro in their upward march, before retreating back to earlier levels, due to a couple reasons. First, low interest rates continue to make the carry trade a viable trading strategy, as investors borrow in Yen and invest in higher-yielding currencies, which effectively keeps the Yen grounded. Second, Japans Central Bank has repeatedly threatened to intervene in forex markets on behalf of the Yen, which has made investors wary about betting too much on its appreciation.
The Chinese Yuan accelerated upward, due primarily to American political pressure and the threat of trade sanctions. Meanwhile, the Thai Baht appreciated almost 20% against the USD, prompting Thailands Central Bank to step in and impose draconian capital controls intended to curb speculation. Emerging market currencies fared equally well on the heels of strong economic fundamentals and intelligent monetary policy that kept inflation on check. If these trends continue, expect 2007 to be a repeat of 2006.
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Lear Has Some Explaining to Do »First Trust Advisors is targeting another closed-end fund for conversion into an exchange-traded fund. The board of directors of the $290 million First Trust Value Line 100 (FVL) said earlier this month that it voted to transfer the fund’s assets into, and assign its liabilities to, a newly created ETF. The board didn’t provide a reason for the conversion, which is subject to shareholder approval. But the transaction would help eliminate the discount in the fund’s share...
AN ITALIAN chef accused of deliberately infecting his Edinburgh partner with HIV told police that he did not have the virus and always wore a condom when they had sex, a court heard yesterday. Giovanni Mola, 38, is accused of passing HIV and hepatitis C to the woman, who cannot be identified, by refusing to wear a condom during intercourse. At the High Court trial in Glasgow today, the jury was shown a video recording of Mola being interviewed by officers from Lothian and Borders Police in...
Commentary: 2006, the year that was
February 4, 2007 on 8:04 pm | In |
The books have been closed on 2006 for more than a week, which means it is time for the forex blogger to give his first-ever state of the markets address. After a dull and static 2005, forex markets roared back into action in 2006, with several notable developments. On everyones radar screens, the worlds most important currency, the USD, declined by over 13% against the Euro and the British Pound. Analysts attributed the decline to narrowing interest rate differentials between the US and the rest of the developed world, as the US monetary cycle peaked while the rest of the world continues to raise rates.
In addition, several countries, notably China, Russia and several OPEC nations announced that they had already begun to diversify their foreign exchange holdings. This process is becoming auto-catalytic, which means that as the USD declines, it makes less financial sense for Central Banks to hold USD-denominated assets, which causes the USD to decline further, and so on. Meanwhile, the US economy is sputtering, and a majority of economists believe the Federal Reserves Bank will lower interest rates in 2007.
The Yen initially joined the ranks of the Pound and the Euro in their upward march, before retreating back to earlier levels, due to a couple reasons. First, low interest rates continue to make the carry trade a viable trading strategy, as investors borrow in Yen and invest in higher-yielding currencies, which effectively keeps the Yen grounded. Second, Japans Central Bank has repeatedly threatened to intervene in forex markets on behalf of the Yen, which has made investors wary about betting too much on its appreciation.
The Chinese Yuan accelerated upward, due primarily to American political pressure and the threat of trade sanctions. Meanwhile, the Thai Baht appreciated almost 20% against the USD, prompting Thailands Central Bank to step in and impose draconian capital controls intended to curb speculation. Emerging market currencies fared equally well on the heels of strong economic fundamentals and intelligent monetary policy that kept inflation on check. If these trends continue, expect 2007 to be a repeat of 2006.
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Cramer’s ‘Mad Money’ Recap: Buy High, Sell Higher »Traders spent most of January pricing in strong growth and low inflation. This week the Federal Reserve itself endorsed the Goldilocks tale. The Federal Open Market Committee kicked off the year with a paradigm shift in its policy statement. Put simply, the Fed said growth got stronger and inflation got weaker. But the central bank kept rates steady and retained its tightening bias. The Fed warned of wage inflation, but Friday’s nonfarm payrolls report shoved off any immediate threat....
Action Insight | Written by ActionForex.com | Jan 07 07 08:59 GMT | Forex Weekly Review and Outlook Dollar and Yen Started with a Strong Note Despite initial weakness, dollar staged a strong rebound across the board on a series of solid economic data to the week with strength, except versus the Japanese. Meanwhile, the Japanese yen has reversed recent weakness and rebounded strongly against European currencies too. Focus of the coming week will turn to ECB meeting as well trade balance,...
Commentary: 2006, the year that was
January 8, 2007 on 10:41 am | In Currency |
The books have been closed on 2006 for more than a week, which means it is time for the forex blogger to give his first-ever state of the markets address. After a dull and static 2005, forex markets roared back into action in 2006, with several notable developments. On everyones radar screens, the worlds most important currency, the USD, declined by over 13% against the Euro and the British Pound. Analysts attributed the decline to narrowing interest rate differentials between the US and the rest of the developed world, as the US monetary cycle peaked while the rest of the world continues to raise rates.
In addition, several countries, notably China, Russia and several OPEC nations announced that they had already begun to diversify their foreign exchange holdings. This process is becoming auto-catalytic, which means that as the USD declines, it makes less financial sense for Central Banks to hold USD-denominated assets, which causes the USD to decline further, and so on. Meanwhile, the US economy is sputtering, and a majority of economists believe the Federal Reserves Bank will lower interest rates in 2007.
The Yen initially joined the ranks of the Pound and the Euro in their upward march, before retreating back to earlier levels, due to a couple reasons. First, low interest rates continue to make the carry trade a viable trading strategy, as investors borrow in Yen and invest in higher-yielding currencies, which effectively keeps the Yen grounded. Second, Japans Central Bank has repeatedly threatened to intervene in forex markets on behalf of the Yen, which has made investors wary about betting too much on its appreciation.
The Chinese Yuan accelerated upward, due primarily to American political pressure and the threat of trade sanctions. Meanwhile, the Thai Baht appreciated almost 20% against the USD, prompting Thailands Central Bank to step in and impose draconian capital controls intended to curb speculation. Emerging market currencies fared equally well on the heels of strong economic fundamentals and intelligent monetary policy that kept inflation on check. If these trends continue, expect 2007 to be a repeat of 2006.
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Sorry, the comment form is closed at this time.
Mid-Day Report: Dollar Mildly Firmer after Mixed Data »Action Insight | Written by ActionForex.com | Dec 22 06 16:09 GMT | Forex Mid-Day Technical Report Dollar Mildly Firmer after Mixed Data Dollar is mildly firmer in early US session despite mixed data. Personal income and spending both rose faster in Nov but fell short of consensus expectation. Meanwhile, the report also show that core inflation is moderating. Headline durable goods order was strong but the details are unexpectedly weak, pointing to further slowdown in manufacturing industry....