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 »

The biggest event risk this week is undoubtedly the Federal Reserve’s monetary policy decision on Wednesday. Now more than ever, the Fed’s decision could turnaround the currency and equity markets. Since the last interest rate cut by the central bank on October 8th, the dollar has rallied more than 8 percent and the [...]

Posted in Currency Intervention, ECB, FOMC, Fed Rate Cut, Fed Rate Cut Expectations, Fed fund futures usdjpy, Federal Reserve, Forex News, Forex Podcast, US Dollar, US Economy, coordinated rate cuts, euro, forex blog No Comments »

The rejection of the $700B bailout plan by the House of Representatives came completely out of the left field, driving a knife through both US equities and the US dollar. For the Bush Administration, it certainly feels like they are moving one step forward and taking two steps back but the severity of [...]

Posted in Bernanke, Bloomberg, British Pound, Crude Oil Prices, Currency forecasts, FOMC, Fed Rate Cut, Fed Rate Cut Expectations, Forex News, Forex Podcast, US Dollar, VIX, bank safe, consumer confidence, euro, forex blog, us earnings, usd/jpy No Comments »

To the surprise of the financial markets, the Federal Reserve left interest rates unchanged at 2 percent. Going into the meeting, everyone thought that the Fed was backed into a corner and would have no choice but to cut interest rates by 25 and possibly even 50bp. Although the tone of the FOMC statement [...]

Posted in FOMC, FOMC Minutes, Federal Reserve, forex blog No Comments »

On Friday, the Dow hitting 10,000 still seemed to be a remote possibility, but today, that is starting to become a reality. We have warned on near daily basis about the danger of carry trades. Although the EUR/USD’s reaction to the systemic risk in the financial markets was not as clear, there was a clearly [...]

Posted in Bloomberg, Dow, FOMC, Fed Rate Cut, Fed Rate Cut Expectations, Fed fund futures usdjpy, Federal Reserve, Forex News, Lehman Brothers, Lehman Layoffs, US Dollar, US Economy, US Treasuries, bank safe, forex blog 2 Comments »