Forex Bull

So what does this rescue do to the dollar? Friday may have provided a clue to the near term direction.

After a week as wild and woolly as this one, a tally of net changes is in order.

The European PMIs have shown ominous signs over the last months after large declines, although there was a marginal improvement last month. The level is still low, and we do not expect the improvement to be an actual improvement for the better.

It has been a hectic week with a series of ad hoc measures taken by the US authorities aimed at securing stability in the financial system. Attempt to save the financial system has now been taken to another level, with the Treasury and the Fed apparently now targeting the entire…

The financial crisis has reached a new dimension this week: Lehman Brothers Holding had to file a petition under chapter 11 of the US Bankruptcy Code; the collapse of the US insurer AIG was only averted by the Fed agreeing an $85bn bailout and the US government taking control of…

The Federal Reserve has been trying to put out fires all over the financial markets; but the damage may be to wide spread to return the markets back to normal anytime soon. With rumors of additional bank failures and a fast approaching recession growing, traders have quickly turned on their…

One would wonder how come the dollar doesn’t collapse against its other counterparts, what with all data coming out badly and more US Banks reporting serious losses. Well, the answer is that although the EUR/USD has managed to recover above 1.40 in the last week, there are still downside risks…

Will it be the Bank of England or the European Central Bank that cuts interest rates more? Markets have priced in numerous rate cuts for the following year, but have yet to decide which bank will blink first

Is the dollar bullish trend over?

As the credit crunch is working its way into the economic system, from banks to mortgages and finally to consumers, the Federal Reserve is watching events carefully.