US Dollar Pulls Back as Forex Traders Get a Taste for Yield
US dollar is pulling back today as Forex traders decide to go for a taste of yield. Over all, risk appetite hasn’t truly returned, but the US economy is just slow enough that many are re-evaluating their positions and paring back recent gains for the greenback.
It’s going to be something of a slow week coming up. Today there is nothing really significant in terms of economic data. Tomorrow will see the July retail sales report, and there will be a PPI report. On Wednesday, though, the CPI data will be released. It will be interesting to see what that shows, since food prices are on the rise with the drought in the Midwest withering crops. Will there be a substitution to make it appear that inflation is low? Of course, core CPI never includes food prices.
For now, the US dollar is pulling back, allowing other currencies the chance to log gains. High beta currencies have a bit of an upper hand right now, even though stocks are a little bit lower. It’s been an interesting divergence recently, in which stocks no longer move in tandem with high beta currencies.
At 13:47 GMT EUR/USD is up to 1.2353 from the open at 1.2290. GBP/USD is up to 1.5702 from the open at 1.5673. USD/JPY is up to 78.3250 from the open at 78.2180.
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Earlier News About the US Dollar:
- US Dollar Surges Ahead After Economic Data (2012-08-09)
- US Dollar Pulls Back as Risk Appetite Makes an Appearance (2012-08-07)
- US Dollar Looks for Gains against other Majors (2012-08-06)
- US Dollar Drops as Risk Appetite Comes Surging Back (2012-08-03)
- No QE from Fed Means Stronger Dollar (2012-08-01)