Fed rate cut and currency tradingThe Fed rate cut seems to have brought some things into perspective in currency trading on the FX market. U.S. interest rates were slashed by 50 basis points, in a large move meant to help the U.S. economy. While this Fed rate cut will initially mean a lower U.S. dollar, if it does work to stimulate the flagging U.S. economy, it could result in a stronger U.S. dollar down the road in forex trading. The International Herald Tribune reports on the Fed rate cut and currency trading:
"The foreign exchange market appears t (more…)
Yuan strong against the U.S. dollar in currency tradingThe Chinese yuan (also known as the renminbi) is up on the FX market today, strong agains the U.S. dollar. Even though currency trading with the yuan is not done by individual traders, following the Chinese yuan may lead to clues about how the dollar will do in Asia, and some forex traders use other Asian currencies as proxies for the yuan. Bloomberg reports on the increase in value of the Chinese yuan on the FX market:
“The appreciation pressure on China is continuing,'’ Craig Chan, a currency stra (more…)
Risk aversion hurts Asian currencies on the FX marketWhen the U.S. economy is affected, other economies and currencies are affected as well, especially emerging market currencies in places like Asia. Right now Asian currencies are down in forex trading on the currency market due to risk aversion stemming from the effects of the credit crunch on the U.S. economy. Bloomberg reports on Asian currencies on the FX market:
“The currency is weaker on renewed jitters on the impact of the subprime crisis,'’ said Jonathan Ravelas, market strategist at BDO Unibank (more…)
U.S. dollar suffers in currency trading due to Fed rate cutEven though the FX market has more certainty and stability now, thanks to the Fed rate cut on Tuesday, not every currency is benefitting from this change. Indeed, the U.S. dollar is down in currency trading on interest rate differentials. Forbes reports on the U.S. dollar and forex trading:
‘While the rate reduction by the US Federal Reserve Board helped ease uncertainty in financial markets, it also narrows interest rate differentials between the US and other currencies, thereby blocking investor (more…)
