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The dollar traded lower in European session as traders were focusing on the outcome of the U.S. mid-term elections. Democrats not only took over the House of Representatives but also got five Senate seats from Republicans, one more seat will give the Democrats a majority in the Senate. However, the election outcome had only little impact forex markets as traders had already priced in a Democrat victory.
Markets now shift focus back to the U.S. economy and the trade figure on Thursday will be closely monitored. Economists are expecting a U.S. trade deficit of about US$67 billion in September, slightly narrower than US$69.85 billion in August. The buck rebounded against the euro and sterling from 1.2808 to 1.2746 and from 1.9098 to 1.9008 respectively. The greenback also rose versus the yen to 118.01.
Comments from Chicago Federal Reserve Bank President Michael Moskow (who will be a voting member of the FOMC next year) regarding higher inflation risk also lent support to the greenback.
Economic data scheduled to be released on Thursday include Australia unemployment data, German CPI, UK trade balance and Canada trade balance. Besides U.S. trade data, there are also reports on University of Michigan consumer sentiment survey and U.S. jobless claims. The Bank of England is expected to raise interest rates by 0.25% after the MPC meeting at 12:00GMT. -------------------------------------------------------------
Updating time : 08/11/2006 22:21 GMT
Dollar range-bound ahead of U.S. trade data
The dollar traded lower in European session as traders were focusing on the outcome of the U.S. mid-term elections. Democrats not only took over the House of Representatives but also got five Senate seats from Republicans, one more seat will give the Democrats a majority in the Senate. However, the election outcome had only little impact forex markets as traders had already priced in a Democrat victory.
Markets now shift focus back to the U.S. economy and the trade figure on Thursday will be closely monitored. Economists are expecting a U.S. trade deficit of about US$67 billion in September, slightly narrower than US$69.85 billion in August. The buck rebounded against the euro and sterling from 1.2808 to 1.2746 and from 1.9098 to 1.9008 respectively. The greenback also rose versus the yen to 118.01.
Comments from Chicago Federal Reserve Bank President Michael Moskow (who will be a voting member of the FOMC next year) regarding higher inflation risk also lent support to the greenback.
Economic data scheduled to be released on Thursday include Australia unemployment data, German CPI, UK trade balance and Canada trade balance. Besides U.S. trade data, there are also reports on University of Michigan consumer sentiment survey and U.S. jobless claims. The Bank of England is expected to raise interest rates by 0.25% after the MPC meeting at 12:00GMT. -------------------------------------------------------------
