MORNING BRIEFING: The Dollar is recovering, carry trades under pressure.

[RTFX-Trading]

MORNING BRIEFING: The Dollar is recovering, carry trades under pressure.

What’s new:
France: current account deficit 3.7Mrds Euros in September.
UK: BoE sees inflation below 2% in late 2011.
England: unemployed increased but at the lowest level since 18 months.
Australia: unemployment rate up to 5.70% in October.

Today:


Rates in Asia and Indices:
EURUSD: 1.5016 - 1.4956.
USDCHF: 1.0099 - 1.0059.
EURUSD: 1.6626 - 1.6515.
EURJPY: 135.03 - 134.20.
USDJPY: 89.98 - 89.64.
Dow Jones: 10'291 +0.43%.
NASDAQ: 2'166 +0.74%.
S & P 500: 1,098 +0.50%.
Nikkei: 9'804 -0.68%.
Shanghai: 3'186 +0.34%.
Gold: $1,120.
Crude oil: $79.31.
 
Comments:
The Dollar is recovering against its major rivals, after reaching a new record high against Gold at $ 1'119.10. Meanwhile, the Pound Sterling is again under pressure following the remarks of the governor of the Bank of England, Mervyn King, who said that the weakness of the Pound Sterling benefits exports from the United Kingdom and promotes recovery.

In its quarterly report, the Bank of England warned that the force of a future economic recovery in the country was "extremely uncertain" and amid widening significant inflation. The market expects that UK interest rates remain near 0.5% for some time.

Weber's statement also pushes the market to take refuge in safe havens currencies like the Dollar and sell the carry trades. He stated that the financial crisis will continue to hamper economic growth and he added that the level of GDP reached in 2008 will probably not recover before 2013.

Good day.

Nicolas Longchamp
RTFX Ltd
Head Office
The Cornerstone Complex, 16th September Square | Mosta MST 1180 | Malta
Tel:  +356 23 31 00 00
Fax: +356 21 41 24 58
Web: www.rtfx.com

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