http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/http://www.fxstreet.com/fundamental/http://mediaserver.fxstreet.com/images/fxstreet-provider-logo1-en.gif7http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-31.htmlThe US dollar’s rally against major currencies from Tuesday, as a result of better-than-forecast US consumer confidence, was carried over to Wednesday, albeit at a slower pace. EUR/USD dipped to another 1-month low of 1.5520 today while USD/CHF rose to a 6-week high of 1.0520 after the release of an unexpectedly positive jobs report from ADP which showed that private employers added 6000 jobs last month, versus an average forecast cut of 60,000 jobs. This surprising outcome is leading many toThu, 31 Jul 2008 08:39:46 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-31.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-23.htmlOn Tuesday, the forex and stock markets were shaken not by corporate earnings results and not by any economic releases, but by a hawkish speech from Fed’s Plosser. The Philadelphia Fed President said there should be interest rate hikes “sooner rather than later” even if employment and financial conditions haven’t improved. This renewed signal to raise rates helped push the US dollar sharply against the Euro, Swiss franc, British pound, Japanese yen, Aussie and Kiwi, and could set the dollar onWed, 23 Jul 2008 07:21:08 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-23.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-21.htmlA crazy week in the markets has gone by again, and I must emphasize the “crazy”. Sentiment has swung from one panic end to another euphoric end, and even so, investors can’t maintain each state of emotion with much conviction or get others to feel the same way they do. Many of them are confused about what to think about the “rally” that we’ve seen in the stock markets this week and the “rally” of the US dollar in the forex markets. Early in the week, stocks kept falling on the woes of FreddieMon, 21 Jul 2008 09:35:07 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-21.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-16.htmlIndeed, Fed chief Bernanke’s testimony before the US Senate Banking Committee today has sparked off big moves in forex and stock markets, as I’ve warned yesterday. Unlike previous testimonies, Bernanke didn’t mince his words that much this time, saying that there are “significant downside risks to the outlook for growth” and “upside risks to the inflation outlook have intensified.” His much-anticipated speech came hot on the heels of the aid given by the US government and the Fed to FreddieWed, 16 Jul 2008 10:10:22 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-16.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-15.htmlThe US dollar had a good start when the forex market opened in Asia on Monday and into the European trading session, inspired by the US government’s plan reported Sunday evening to help the struggling mortgage giants Freddie Mac (FRE: 7.11 0.00 0.00%) and Fannie Mae (FNM: 9.73 0.00 0.00%). But as we move into the New York session, traders are taking their profits on dollar strength for fear that the US currency may not have sustained buying interest due to continued downside pressure on the USTue, 15 Jul 2008 09:14:49 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-15.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-14.htmlEarly this year there has been talk about how the US economy could experience a V or W or L shaped economic situation, and now it seems that the economy could indeed be heading towards further deterioration. Although this past week has been one bereft of much major economic releases from the US or Eurozone, traders and investors have been subjected to more negative news coming from the US financial sector. On Friday, the US dollar fell sharply against the Euro, Swiss franc, British pound andMon, 14 Jul 2008 13:47:15 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-14.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-10.htmlThere is simply no direction in the financial markets, especially the currency markets, in the absence of major US economic data releases. Major currency pairs such as EUR/USD, USD/CHF and USD/JPY have been moving more or less sideways since Monday with the US dollar on the stronger side, but today the US currency is looking a bit vulnerable as US stocks dip into the red after Tuesday’s “rally”, and on news that Iran has test fired long and medium range missiles, capable of reaching Israel.Thu, 10 Jul 2008 09:31:24 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-10.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-04.htmlHere are today’s market-moving numbers in a nutshell: the US non-farm payrolls showed a loss of 62,000 jobs and the unemployment stood at 5.5%, close to what the majority of the market had expected. And over in the Euro area, the European Central Bank has raised its main interest rate by 25 bp to 4.25%, as predictable as receiving a present on your birthday (from yourself that is). Traders who had positioned themselves ahead of these releases to be long on the Euro and short on the US dollarFri, 04 Jul 2008 12:44:41 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-04.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-02.htmlOil continues to trade near elevated levels (above $143 as at the time of writing) on Iranian verbal threats, and the Dow Jones Industrial Average is down more than 130 points. Iranian Deputy Oil Minister was reported as saying Iran is ready to repel any attack, and said that an attack would disrupt oil exports and disrupt the entire oil industry in the Middle East. Middle-East tensions are at the forefront again. Meanwhile, OPEC president said that oil prices reflect war risk, and to keep oilWed, 02 Jul 2008 08:26:24 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-07-02.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-30.htmlThis coming week will be a shortened trading week in the US due to the celebration of Independence Day on Friday. Quite a number of key economic releases and data will be packed into these 4 days, so there won’t be rest for traders at least till late Thursday. The currency market will turn its attention to the rate announcement by the European Central Bank on Thursday whereby the central bank is almost guaranteed to raise the main refinancing rate from the current 4% to 4.25%. So far thisMon, 30 Jun 2008 13:24:20 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-30.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-27.htmlWhen oil jumps, you can expect the US stock markets to react badly and the US dollar to succumb to shorting pressure from traders. At one point on Thursday, crude oil futures leaped more than $4 to above $138 a barrel after a slight retreat yesterday. US data released today didn’t give any strong indication of which way the US economy is going to head towards, and in any case, inflation numbers remained higher than what the Fed would like to see. US gross domestic product gained 1%, at anFri, 27 Jun 2008 13:32:22 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-27.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-26.htmlThe US dollar fell against the Euro after the Fed held the main interest rate unchanged at 2%, ending a series of 7 consecutive cuts. What happened? Most market participants had expected the Fed to keep the rate unchanged anyway in Wednesday’s FOMC meeting. Initially the dollar traded higher but that subsided and traders began taking their profits on long dollar positions. In the accompanying statement, the Fed said, “Although downside risks to growth remain, they appear to have diminishedThu, 26 Jun 2008 08:25:41 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-26.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-25.htmlRecord-breaking downbeat consumer confidence and housing data released today have depressed the US dollar in the currency markets, although the USD remains within recent range against the Euro, Swiss franc, British pound and the Japanese yen. US consumer confidence fell to 50.4 this month, worse than the forecast reading of 56.4, from a revised 58.1 in May (originally reported at 57.2). June’s reading was the lowest since 47.3 in February 1992, which means that US consumers haven’t beenWed, 25 Jun 2008 07:25:07 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-25.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-23.htmlAnother week has passed, and the sentiment in the financial markets has changed again. In the forex markets, the US dollar fell against other currencies like the Euro, and in the US stock markets, the Dow and S&P 500 had another strong downward spiral Friday. One of the events that’s got traders talking about and reacting to is next week’s US Federal Open Market Committee (FOMC) meeting. Poor US manufacturing data has led traders to scale back their expectations of a rate hike by the FedMon, 23 Jun 2008 12:11:05 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-23.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-20.htmlThe wind direction has changed suddenly in the UK. After several disappointing UK economic data and higher than expected inflation numbers, most market players are caught by surprise by today’s release of UK retail sales which came out much better than even the most optimistic estimates. UK retail sales data surged 3.5% m/m and 8.1% y/y in May on increased food and clothing sales, eclipsing the -0.1% and 4.1% average forecasts. The 3.5% increase in UK sales was the most since the governmentFri, 20 Jun 2008 08:21:48 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-20.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-19.htmlAccording to the UK daily newspaper Telegraph, a research team from Royal Bank of Scotland is warning investors to get ready for a “full fledged crash in global stocks and credit markets over the next three months”, noting inflation will paralyze major central banks. They forecast a 300 point drop in the S&P by September to around 1050, with contagion spreading across global stock markets, and for the iTRAXX index (high grade corporate bonds) to widen to 130/150, the “Crossover index” (lowThu, 19 Jun 2008 09:48:51 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-19.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-18.htmlUS industrial production fell for the second consecutive month in May, falling 0.2%, following an unrevised 0.7% decline in April. This was worse than the 0.2% gain expected as utilities posted a sharp decline in output. Overall, industrial production is down 1.1% compared to a year ago. No one can deny that industrial output is contracting, but at least it hasn’t been a rapid drop. Meanwhile, inflation data released today showed that US producer prices in May rose at their fastest rate in sixWed, 18 Jun 2008 07:38:52 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-18.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-16.htmlIt was Friday the 13th yesterday, but the US currency wasn’t at all spooked. While the US stock markets closed the week almost flat (Dow up 0.8%; S&P 500 down 0.05%), the US dollar had a roaring good time in the currency markets. The US dollar just clinched the biggest weekly gain against the Euro since 2005 and the biggest weekly rise against the Japanese yen since December 2004. You could say that Bernanke’s speech on Tuesday initiated the strong turnaround in USD sentiment; he said thatMon, 16 Jun 2008 09:27:38 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-16.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-13.htmlThe near to medium-term outlook of the US dollar in the currency markets is one of relative strength, particularly against the Euro, Swiss franc, British pound and Japanese yen. Ever since Bernanke indicated he has his eyes fixated on the weakening dollar last week, together with US Treasury Secretary Paulson and president Bush reiterating this week their commitment to a stronger dollar, the change in dollar sentiment has been quite dramatic, although it went a little shaky after ECB’s TrichetFri, 13 Jun 2008 11:43:16 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-13.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-12.htmlThe currency market is taking its cue today from the performance of US stock markets in the absence of major US economic releases. The US dollar initially rose against the Euro, Swiss franc, British pound and Japanese yen but is now trading lower versus these currencies. European Central Bank’s Juergen Stark said Wednesday that markets understood the central bank’s signal to raise interest rates next month, but he poured water over the speculation of a series of interest rate increases. ECB’sThu, 12 Jun 2008 07:26:06 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-12.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-11.htmlYesterday I posted an article saying to watch out for Bernanke’s speech as that was likely to support the US dollar. Indeed, the dollar surged strongly against major currencies such as the Euro and Swiss franc after Bernanke unexpectedly revealed some optimism in his speech. He said the economic outlook has improved from a month ago and pledged that central bankers will fight any increase in inflation expectations. “The risk that the economy has entered a substantial downturn appears to haveWed, 11 Jun 2008 09:03:58 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-11.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-10.htmlThe US dollar was initially weaker against the Euro and the Swiss franc Monday but by New York open, it erased much of its earlier declines on the stabilizing US stock markets (Dow went up by more than 100 pips intraday)and after the release of a better-than-expected report on US pending home sales in April. The National Association of Realtors’ index for pending sales of previously owned homes rose 6.3% to 88.2 from March, and this is the highest level in six months. The surge in buyingTue, 10 Jun 2008 10:23:12 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-10.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-05.htmlThe US dollar is stronger today against currencies like the Canadian dollar, British pound and Japanese yen, but remains more or less unchanged versus the Euro, Swiss franc. Broadly speaking, sentiment is still supportive of a USD rebound. The ADP employment report released today showed that private sector jobs rose by 40,000 in the US in May, better than the 30,000 drop expected by most economists. In April, 13,000 jobs were added by the private sector, which was revised up from theThu, 05 Jun 2008 08:07:35 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-05.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-04.htmlFed chief Bernanke’s words today are likely to support the US dollar in the short to medium-term. Speaking via satellite at an International Monetary Conference in Spain, Bernanke said that the Fed is “attentive to the implications of changes in the value of the dollar for inflation and inflation expectations”, since the dollar has lost much of its value against other major currencies like the Euro. It is very rare for Bernanke to talk specifically about the dollar, so his voicing out of theWed, 04 Jun 2008 13:28:19 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-04.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-03.htmlThe risk aversion theme is back in the financial markets. Both the US dollar and the Euro are down against the Japanese yen as carry traders buy back yen to close their carry positions. What’s causing the run-to-safety switch in sentiment are renewed fears that the world hasn’t seen the end of the credit market turmoil, making investors nervous about holding positions whereby they had sold the yen to buy high-yielding currencies like the Euro. UK’s largest lender of buy-to-let mortgages,Tue, 03 Jun 2008 08:45:46 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-06-03.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-30.htmlThis week has so far been a good one for the US dollar - the US currency rallied higher against other currencies like the Euro, Swiss franc, British pound and Japanese yen after the positive US GDP data that met expectations, following Wednesday’s better-than-expected durable goods orders. The government said today that US gross domestic product, a measure of goods and services produced, rose at a seasonally adjusted 0.9% annual rate in the first quarter, which was slightly higher than theFri, 30 May 2008 10:06:32 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-30.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-29.htmlThe US dollar is stronger against major currencies Wednesday after a government report showed that US durable goods orders slipped by just 0.5%, less than the 1% drop expected by most economists. This small drop is pretty impressive actually, considering that if you exclude transportation goods from the equation, you get a 2.5% rise in durable goods (-0.5% expected), and that is the biggest increase since 3.7% in July last year. So while demand for civilian aircraft fell, there was a decentThu, 29 May 2008 13:21:27 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-29.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-28.htmlAn avalanche of economic data was released today from both the Eurozone and the US, and the US dollar has been stronger across the board. The greenback is up against the Euro, Swiss franc, British pound, Japanese yen, Canadian dollar and Australian dollar. Euro weakness was more pronounced during the European trading session after it was reported that French business confidence weakened sharply in May to its lowest level since December 2005. Business confidence in France weakened to 102 in MayWed, 28 May 2008 07:49:13 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-28.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-22.v02.htmlThe Fed has given us a bleak prognosis of the US economy as can be seen from the minutes of the FOMC meeting on April 29/30. Here are some downbeat forecasts: the Fed cut its forecast for economic growth to 0.3% - 1.2% in 2008, a far cry from its earlier projection of 1.3% - 2%. Not only that, Bernanke and colleagues expect the unemployment rate “to pick up further this year and to remain elevated in 2009″. According to the minutes, the decision to cut interest rates by 25 basis points was “aThu, 22 May 2008 15:08:44 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-22.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-22.htmlA stronger-than-expected German IFO business climate index lifted Euro to a three-week high against the US dollar Wednesday. The headline index came in at 103.5 in May from 102.4 in April, versus a 102 forecast. An indicator measuring expectations for future business rose to 97.3 from 96.7. IFO said today that “the downturn in the German economy will be rather moderate” and “we will see at least 2% growth this year”. German Economic minister Glos said today that the recent surge in German IFOThu, 22 May 2008 08:52:41 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-22.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-19.v02.htmlThe US dollar is higher against currencies like the Euro, Swiss franc, British pound and the Japanese yen Monday. US Conference Board’s index of leading economic indicators rose by 0.1% in April to a reading of 102.0, matching the gain seen in March, and was in line with expectations. This private research group even said that even though the data certainly reflects a weak economy, it does not reflect one that’s in recession, and also noted that the small gains in the leading index for bothMon, 19 May 2008 16:14:25 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-19.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-19.htmlThe US dollar just had its biggest weekly fall against the Euro in a month on decades-low US consumer confidence and record prices of crude oil. On Friday, crude oil rose to an all-time high of $127.82 a barrel, after Goldman Sachs increased its forecast to an average of $141 a barrel for the second half of this year, up from $107, saying that demand from BRICs (Brazil, Russia, India and China) will overwhelm supply. The dollar also got an indirect hit when the head of the FDIC (FederalMon, 19 May 2008 10:43:20 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-19.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-16.htmlThe US dollar is slightly down against major currencies like the Euro, Swiss franc, British pound and the Japanese yen Thursday. To everyone’s surprise, all is not gloom in the Eurozone. France, which is Eurozone’s second largest economy, reported today that its gross domestic product grew 0.6% in the first quarter, double that in the previous quarter, and better than the 0.5% growth expected. Even though the high Euro is hurting exports to some degree, export growth is still robust despiteFri, 16 May 2008 09:48:44 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-16.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-15.htmlToday’s release of US inflation data should ease some anxiety off the Fed officials as it showed that consumer prices are increasing at a mild pace. The consumer price index rose 0.2% in April, less than the 0.3% expected by the market, and following a 0.3% increase in March. Core prices excluding food and energy costs, gained 0.1%, compared with a 0.2% gain the prior month. Food prices, which make up about a fifth of the CPI, gained 0.9%, the most since January 1990. The sluggish US economicThu, 15 May 2008 10:03:22 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-15.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-14.htmlUsing harsh words to make people do what you wish them to do doesn’t always work, and if it doesn’t, you could try to nudge in a positive way, saying that it would be nice if they do as you say. This gentler form of persuasion seems to be working right now, coming from Euro Group chairman and Luxembourg Finance Minister Jean-Claude Juncker, coinciding with the change in market sentiment towards the US dollar in the forex markets. He said that before, “financial markets didn’t correctlyWed, 14 May 2008 07:12:52 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-14.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-12.htmlChicago Fed president Charles Evans, a non-voting member of the FOMC this year, said Monday that the Fed policy is accommodative, with the real funds rate zero or slightly negative. He said that economic growth risks are to the downside and inflation risks to the upside. He expects continued weak growth and tight credit in the near term, but said the US economy should improve somewhat in the second half of this year. He also noted that while the stimulus package may help American consumers,Mon, 12 May 2008 15:43:59 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-12.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-09.htmlFriday’s data showed that the US trade deficit unexpectedly narrowed in March, shrinking to $58.2 billion from $61.7 billion in February (initial estimate was $62.3 billion). This 5.7% decline was more than what most analysts had expected as they had predicted the gap would narrow to $61.3 billion. At first glance, this is good news for the US dollar as it shows that the deficit is narrowing and not ballooning. However, what caused the trade gap to narrow was not an increase in exports, but aFri, 09 May 2008 16:09:14 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-09.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-08.v02.htmlBillionaire investor Jim Rogers said today that he is expecting a US dollar rally in the currency markets. The Singapore-based Rogers, who predicted correctly the current commodities boom, said at the launch of the Barclays Global Agriculture Delta Fund in Singapore today he expects a “nice rally” in the US dollar because many people including himself have been bearish on the dollar. He is also bullish on the Australian dollar, saying he does not have plans to sell the Aussie as “they have aThu, 08 May 2008 14:41:34 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-08.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-08.htmlToday we are seeing signs that the US dollar could still resume its short-term recovery, leaving its so-far bottom behind by rising against the Euro, British pound, Swiss franc and Japanese yen. The USD sentiment boost came from weak Eurozone data and hawkish comments by Kansas City Fed President Thomas Hoenig. Hoenig, a non-voting member of the FOMC, said yesterday that “serious” inflation problems may lead the Fed to raise interest rates. He said, “There is a significant risk that higherThu, 08 May 2008 07:31:04 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-08.htmlhttp://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-07.htmlJust last week dollar’s rebound looked promising, but yet as we enter the second trading day of the week, dollar’s upside momentum is slipping away. The main catalyst of dollar’s decline today has been the bigger-than-expected loss by Fannie Mae, US’s biggest mortgage lending company, reigniting fears that we haven’t seen the worst of the financial market turmoil. The company reported a first-quarter net loss of $2.19 billion, or $2.57 a share, compared with a loss of 64 cents a share, andWed, 07 May 2008 07:54:40 GMThttp://www.fxstreet.com/fundamental/market-view/gracecheng@gracecheng.com (GraceCheng.com)http://www.fxstreet.com/fundamental/market-view/news-and-opinion-from-the-ground/2008-05-07.html