A lot of investors want to hang on to short dollar positions. In the current environment, you don't want to fight the trend.
Monetary policy expectations were the driving forces on the FX markets in most of 2005 and while we expect structural problems to come back to haunt the dollar in 2006 we expect monetary policy expectations to lend support to the greenback early in the year.
Monetary policy expectations were the driving forces on the FX (foreign exchange) markets in most of 2005 and while we expect structural problems to come back to haunt the dollar in 2006 we expect monetary policy expectations to lend support to the greenback early in the year.
Higher oil prices, and fears over Japanese stocks are affecting the dollar more than any other currency.
We do expect broad-based dollar weakness to resume when or shortly after the U.S. Federal Reserve begins to signal the end of the current tightening cycle.
Given that the dollar was unable to really bounce on the back of lower than expected trade deficit yesterday, it seems a bit unlikely that even if the retail sales show nice gains that (it) will be able to really benefit from such data.
Sentiment against the dollar is deep-rooted. Every time we have a pullback in euro/dollar new buyers emerge.
Forces driving the dollar are still the same, concerns about the current account deficit. A rise in sterling, triggered by strong UK data, is also contributing to dollar weakness,
People already have a more positive view of the European economy, so they are not that fussed. The market is a bit tired after all the dollar selling this week.
We have had disappointing data in the United States this week and in the euro zone we have had comforting news. If we get a weak GDP number no one would want to hold onto long dollar positions next week.
It's too early to conclude it's the end of the dollar rally. Data in the U.S. should continue to be healthy and we could see rate expectations moving higher, supporting the dollar.