The two biggest inputs into GDP are consumer spending and trade. Therefore the 2.8 percent decline in retail sales and the surprise widening of the trade deficit in the month of October suggests that GDP growth could take a big dive in the fourth quarter.
Word on the street is that some economists [...]

Posted in Forex News, consumer spending, forex blog, retail sales No Comments »

On the eve before Thanksgiving, the price action in the currency market has been very erratic. Equities rallied for the fourth straight trading session while the US dollar weakened against the Australian and New Zealand dollars but strengthened against the Euro, British Pound and Japanese Yen.
Currencies appear to be decoupling from equities [...]

Posted in Bernanke, Currency forecasts, Fed Rate Cut, Fed Rate Cut Expectations, Federal Reserve, Forex, Forex News, Forex Technicals, US Dollar, consumer confidence, consumer spending, eur/usd, euro, forex blog, jobs No Comments »

US GDP growth has contracted but that has not stopped the equity and currency market from rallying. The GDP number was not as bad as the market had feared but what really drove the markets higher was the Federal Reserve’s new Term Asset-Backed Securities Loan Facility (TALF).
Both the outgoing and incoming Presidents are [...]

Posted in Bernanke, FOMC, Forex, Forex News, Forex Podcast, TARP plan dollar, US Dollar, US Economy, consumer spending, coordinated rate cuts, dollar earnings, eur/usd, euro, forex blog 1 Comment »

Every single day we have more reason to believe that the US unemployment rate will break 8 percent next year. Jobless claims rose to a 16 year high last week of 542k, driving the US dollar lower against the Japanese Yen. Continuing claims rose to 4.012 million, the highest level in close to [...]

Posted in Bernanke, FOMC, Fed Rate Cut, Fed Rate Cut Expectations, Federal Reserve, Forex News, consumer spending, forex blog, jobs, non-farm payrolls No Comments »

Despite false rallies in the currency market, I have stressed that there is no reason for the liquidation to be over. I warned that the currency and stock market rallies were a mirage rather than a bottom and now, the pessimistic tone of the FOMC minutes has forced another wave of liquidation.
Tuesday’s [...]

Posted in Bernanke, Carry Trades, FOMC Minutes, Fed Rate Cut, Fed Rate Cut Expectations, Forex News, US Dollar, USD/CAD, consumer spending, eur/usd, forex blog, oil dollar, usd/jpy, weak dollar earnings 3 Comments »