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September 07, 2010
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The US Dollar Versus The Swiss Franc

We’ve got two major currencies here and we’re going to see which one got the upper hand during June on the currency converter. The US dollar is going head to head with another major currency, so it will be interesting to see what happens.

At the end of May the US dollar was worth 1.1562 Swiss francs.  This immediately jumped up to 1.1668 just one day later, but would it stay that way?  The answer came swiftly – and it was a no.  By the end of the second day of trading in June the exchange rate had dropped back to 1.1579.  The first week saw the US dollar settle on 1.1567 Swiss francs.

The second week, however, did not go in favor of the US dollar in any way at all. By the time it had struggled through those five days of trading, it was on a lower rate of 1.1456.  After the good start to the month it seemed as if the US dollar was struggling to make any real headway.  But how would the rest of the month turn out?  It was still very early, after all.

We were fast reaching the halfway point of the month now, and if we thought the US dollar could start the week beginning the 14th in better style, we were at least rewarded with a rate of 1.1356.  Unfortunately that was just about as good as it got for the whole week, because things went on a downhill run in favor of the Swiss franc after that.  The US dollar fairly limped home on the Friday evening, having managed to garner a rate of 1.1109.

So the dollar was now at a significant disadvantage against the Swiss franc.  The opening rate for the month of 1.1562 seemed a long way away now, and the best we could hope for was to improve on the losses somewhat.  The next Monday finished on 1.1087 though, so it wasn’t looking very good at all.

Once again the losses continued throughout the week on a pattern that was by now becoming all too familiar.  If we could change that and somehow get back on track with even a slight increase, we could rectify things.  But it was not to be and the week finished on 1.1007.

It wasn’t even a case of too little, too late at this stage.  It was more like a case of nothing at all.  This was borne out by the next figure we got at the end of Monday on the final week, when the dollar grabbed a total of 1.0849 Swiss francs.  The franc was going to be the clear winner here, with a final rate for the month of June of 1.0824 on the cards.  This added up to a 0.0738 loss overall, so if the US dollar wants to improve on that figure it will have to put in a great performance during July to make it happen.

We’ll be watching closely to see if it does.

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Greenback a Safe Haven?

Avatar Posted by Andrew McCartney at Jul 30, 2010 08:44 AM
I’m not so sure the greenback is going to be a safe haven currency much longer. The economy is clearly struggling and now the reports are saying that US recovery is going to last well into 2011 and maybe into 2012. In the meantime the European economies are showing signs of growth. But the real concern is the US burgeoning debt and no action being taken to slow it down. There’s talk of adding a US Vat tax but even if it happened, it would take years to implement. So in the meantime the GDP acts like a slug in a garden. The only real factor right now that makes the US dollar safe is the fact it can print money. But as the US dollar falls, the inflation and interest rates are going to go up. Printing more money is going to make inflation rates go higher. The US has boxed itself in with few exits except raising taxes.

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