Currency Exchange UK

 

Euro down and US dollar poised for Comeback

Euro down and US dollar poised for Comeback

Quiet trade and investor easing has caused the US dollar to retreat against the Euro after a strong Monday which had brought the Euro down from its 14-month highs.

The US dollar has been generally weak for a sustained period of time but a boost was provided on Monday as a result of a quiet day for economic data and political news from Europe. 

US government bond yields had risen which may also have served to boost the dollar. 

It had largely been expected from within the foreign exchange market that the dollar might regain some strength due to the large amount of short positions on it – such a sustained period of weakness is likely to cause a reaction, although this is yet to take place.

It is possible that economic data to be released later this week in the US may cause a market reaction.  It has been forecast that third quarter results from within the USA would signal the end of the recession there, with strong business results.

Overall the currency market has been enjoying risk of late and this has also caused the US dollar to take a knocking.

The Euro had reached $1.50 and beyond on Monday but today was back to well below that at $1.4873.