DJ Forex Focus
This is a good time to look outside the usual currency box. As the global recovery splutters and interest rates in the major economies look set to remain lower for longer, the attraction of major currencies is fading fast.
0 comments China's influence on currency markets may not be quite as direct as expected. Instead, Beijing's policies are acting more like shadow puppets in the background, likely increasing support for the yen but undermining the outlook for commodity currencies.
0 comments The higher the euro rises against the dollar, the further it is likely to fall. For the past month or more, the single currency has been climbing as fears of a double-dip recession in the U.S. have grown and the outlook for U.S. rate hikes has been scaled back.
2 comment A reality knock is on its way for the pound. For the past week or so, sterling has been gliding higher, boosted by the new coalition government's fiscal discipline and by talk from one Bank of England monetary policy maker that rates should rise.
0 comments By her successful negotiations with the mining companies last week, Australia's new prime minister Julia Gillard has helped to remove a major obstacle to Aussie dollar gains. However, the Australian currency now faces a new and possibly larger obstacle to extending its rally: China.
0 comments The Bank of Japan would be well advised to sit on its hands. As upward pressure on the yen intensifies, the temptation for the central bank to intervene is certainly growing.
0 comments The Swiss National Bank may yet regret its recent candour. Jean-Pierre Danthine's surprise confirmation this week that the central bank won't intervene to halt the Swiss franc's rise again, unless deflation pressures return, opens the door to even more fierce euro/franc losses.
0 comments New worries about the U.S. economic recovery may be slowing the euro's slide against the dollar. However, the single currency will still accelerate its decline elsewhere--falling even faster against the pound, the Swiss franc, the yen and even the Swedish krona as global market sentiment deteriorates.
0 comments The yen's recent rally is about to get a new lease of life. As the outlook for the global recovery turns more uncertain and as international investors become more risk-averse, safe-haven currencies, such as the yen, are once again to the fore.
0 comments It's like watching a bird having its wings clipped. Up until last week, the strength of the Australian economy, the country's close association with China as well as the prospects for the global economic recovery all appeared to be working in the Australian dollar's favor.
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