Posted August 17, 2010
The US dollar falls against most of its competitors. The yen and franc improve during the day.
During the Monday trading session, the US dollar fell against most of the major currencies. The yen and the franc both perform well during the session as investors take on risk even with concerns about a global economic slowdown.
During the trading session on Monday, the US dollar marked a significant fall against numerous currencies. This was spurred on by the negative sentiment many investors felt due to the numerous economic reports out last week seemed to improve during the day. In addition, a weak Japanese growth data report out caused investors to further worry about the economy. However, investors did move to make changes in currencies as the moves last week were too fast.
The United States stocks, an indicator of the currency markets as of late, recovered from an earlier in the day fall as the concerns about the Japanese data hit the wires. This report and the stock improvements helped to encourage investors to move away from some of the gains that the United States dollar had on the previous trading day. Last week, investors pushed back other currencies and turned up as investors shunned risk. Last week, the US dollar improved by nearly three percent against a basket of major currencies. This changed during the day today.
In addition, the US manufacturing and housing data out showed less than ideal numbers. Nevertheless, investors seemed to shun this information, though they were more cautious during the day's trading. Many turned to the yen and the Swiss franc instead, both of which saw marked improvements.
By The Numbers
During a trading session marked mostly by a fall back of the US dollar, several key moves should be noted. The yen moved to trading below 85.50 during the day. This shows that the markets are still concerned about taking on risk. The ICE Futures US Dollar Index also showed the US dollar falling back against a basket of other currencies. It was down 0.6 percent to 82.477. Last week, the same index gamed 3.13 percent, which is the biggest gain it has seen in almost two years.
The euro improved against the dollar during the trading session. Last week, the euro fell by as much as four percent. That was the largest drop it has seen since May 9th. The euro stood at US $1.2815 at the end of the day, which is an improvement of 0.5 percent for the day. It managed to move to one month lows that occurred during the Asian trading session.
Investors are still concerned about the euro and the changes likely to happen in the coming days. The euro continues to remain in a vulnerable position as concerns about the euro zone's banking and financial sectors continue to weigh on investor minds. The euro zone's sovereign debt crisis is still in the minds of investors as well.
Investors stated that the news downside trade for the euro to US dollar combination was US $1.2600. That is a fifty percent fall back.