Posts by "speculator"

the pound vs dollar is being supported by relatively low unemployment in eurozone and seen to be the first economy out of recession and of course a recent move against high risk aversion.

i think sterling's run has run out of steam and will for sure not pass 1.70 as risk aversion is out there and will only get worse after stocks enter a large correction over the next few months.

for now i cant see 1.40s but early 1.50s is my target for year end:

1 increasing risk aversion globally to increase flight away from sterling vs dollar

2 government debt issues hanging over credibility of uk economy

its easy to sometimes extrapolate short trends but you can be awfully wrong by getting carried away.

do not bet against the dollar and feel that recent weakness will continue. The rest of the year will see risk aversion where commodity currencies will fall.

Source bloomgerg 14th june?

G-8 finance ministers said they will start planning exit strategies for when sustainable growth returns. Its still too soon to roll back budget deficits and bank bailouts, they said after a meeting in Lecce, Italy.

We discussed the need to prepare appropriate strategies for unwinding the extraordinary policy measures taken to respond to the crisis once the recovery is assured, the ministers said in a statement yesterday after two days of talks. There are signs of stabilization, though the situation remains uncertain.

Signs the worst slump since World War II is moderating are prompting central bankers and investors to warn that inflation will accelerate if governments dont cut back. U.S. Treasury 10- year note yields last week reached 4 percent for the first time since October.

There is a distinct shift in tone from the G-8, said Eswar Prasad, an economist at the Brookings Institution in Washington. Still, rising interest rates due to concerns about fiscal deficits and prospects of inflation could choke off a nascent recovery.

what implication will the above have on the currency market? could this be dollar positive if exit strategies are being talked about. Or is this some kind of aid to curb interest rate expecations and keep yields and the dollar stable so further quantitative easing is not required.

yes b ut he said dollar will collpase when it rallied after lehman collapse. he has no shorts right now so he says. but if he thinks economic conditions will worsen, that should be stock negative and dollar positive but he dont think so.

ashraf, if asian bond holders dont diversify their dollar holdings and continue to support a strong dollar which seems like it right now, how can this have an impact on the dollar? surely this could attract more foreign capital seeking yield.