Posted March 31, 2010
Currencies around the world move as US economic data offers confidence. The euro continues to gain in Wednesday trading.
During Wednesday trading, currency traders from around the world reacted to everything from the economy to Greek debt concerns.
In Mexico on Wednesday, the peso soared against the US dollar. It rose to 17 month highs. The move is a direct result of the country’s confidence that the US economy is growing and will continue to rebound. Exports throughout Latin America are expected to rise, assuming economic growth can be maintained. The peso moved from 12.4325 yesterday to 12.3550 in trading on Wednesday. That is the highest since October of 2008.
Currency out of Brazil indicates that the country’s central government will tackle inflationary concerns. The government had a 1.09 billion Brazilian real deficit. Investors had forecast that the country would have a 1.23 billion real surplus instead. Inflation is likely to grow by 5.2 percent in 2010, the central bank said, with the target being 4.5 percent for the country. This information plus the fall back of the US dollar in trading this week has allowed for the Brazilian real to increase in trading on Wednesday.
The Yen and Euro
The yen fell on Wednesday to eight week lows against the euro. The dip was mainly due to economic data out of the US that indicates that US employers have added jobs for the first time in two years. This improves confidence that the US economy is improving. The yen fell to its weakest euro in three months against the US dollar in trading on Wednesday. A report due out on Thursday is likely to show confidence that Japan’s larger manufacturers are improving. The yen moved from 124.44 on Tuesday to 125.32 as of early morning on Wednesday, London time. The Japanese yen was at 93.24 against the dollar, up from 92.76. It slipped to 93.6 during trading, making it the lowest level since January 8th. However, the euro gained from $1.3414 to $1.3441 in trading on Wednesday.
US Economic News
Economic news out of the US continued to offer signs of strengthening which caused ripples throughout the currency markets around the world. US employers added more than 40,000 jobs in the month, which is the most the country has seen since December of 2007. A nonfarm jobs report excepted on April 2nd is likely to show an increase of 184,000 positions added, the Labor Department stated. That marks the most in the last three years created.
Another currency sometimes less often spoken about is the South Korean won. In trading on Wednesday, the won fell against the US dollar. This marks the first time this occurred in four days. The change in value occurred as speculation that the Bank of Korea wants to slow some of the gains. The won moved from 0.1 percent to 1,131.3 against the US dollar.
Another currency saw some movement in the markets on Tuesday and Wednesday. Chile’s currency moved to 525.31 pesos in trading against the US dollar. This is an advance of 0.5 percent.