The US dollar retreats to its lowest levels since January

[RTFX-Trading]

The US dollar retreats to its lowest levels since January

What’s new ?
US: Employers cut 539'000 jobs in April; unemployment soars to 8.9%,
China: Prices fall 1.5%, deflation in 3rd month
China: 1st case of swine flu, the government is taking measures.

Today:
08h45 France: Industrial production M/M (MAR), exp -0.50%, previous -0.50%.
14h30 Canada: New house prices (MAR), exp -0.50%, previous -0.70%.
16h00 US: Employment trends (APR), previous 90.1.
23h30 US: FED president Bernanke speaks on state of US economy

Overnight Rates & Indices:
EURUSD: 1.3667 – 1.3616.
USDCHF: 1.1073 – 1.1021.
GBPUSD: 1.5246 – 1.5191.
EURJPY: 134.83 – 133.97.
USDJPY: 98.83 – 98.17.
DowJones: 8'575 +1.96%.
NASDAQ: 1’394 +0.31%.
S&P 500: 929 +2.41%.
Nikkei: 9’451 +0.20%.
Gold: $916.60

Comments:

The U.S. dollar falls to its lowest levels since January against other major currencies. With better than expected US job figures, positive market reaction to measures taken by the European Central Bank and the Stress test report in line with expectations, investors seem more confident. The "carry trades" are the big winners as the Australian and New Zealand Dollar made huge gains.

The coming week should indicate more clearly whether the recent signs of stabilization in the U.S. economy are confirmed by the quarterly results of major industrial distributors. The market will also follow a series of economic indicators to see if the recession is losing its intensity: retail sales, business inventories, weekly claims, the producer price index and consumer price index are expected throughout the week. If the figures confirm an economic stabilization of the economy, the dollar should continue to weaken, while the "carry trades" should continue to appreciate.

Good Day

Emman Xuereb
RTFX Ltd
Head Office

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