With the growing belief that the American currency has lost a huge appeal in the stock market and that interest rates in the Eurozone will eventually rise, the forex dealers and hedge funds have been betting against the dollar.
Stock exchange data clearly shows that since the Middle East crisis became worse, most traders are selling “short” the U.S. currency. Rising oil prices and the huge US fiscal deficit was said to somehow affect the huge slide in the U.S. dollars.
According to Kit Juckes, the head of FX strategy at Société Générale, “We may be seeing a turn in the longer-term outlook for the dollar—for the worse.” He added that due to the rising oil prices which causes a supply-side inflationary shock, the US Federal Reserve was more likely to react gently to this than any other central banks.
No related posts.
Related posts brought to you by Yet Another Related Posts Plugin.