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by Ashraf Laidi
Posted: Feb 22, 2010 5:00
Comments: 2338
Posted: Feb 22, 2010 5:00
Comments: 2338
Forum Topic:
USD
Discuss USD
November 03, 2010, 10:00 PM EDT
More From Businessweek
By Bloomberg News
Nov. 4 (Bloomberg) -- Former Chinese central bank adviser Fan Gang said the nation will continue to allow the yuan to appreciate gradually to avoid fluctuations.
It wont be a problem for China to achieve economic growth of 8 percent to 9 percent for the next two years, Fan said at a forum in Beijing today. Inflation should stay within 3 percent to 4 percent in the next two years, he said.
Asset bubbles in China have at present been stabilized, Fan said. Further adjustments may take place in the future, he said.
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Ashraf
its major support for more upside or should i say upbeat
US-German 10-year yield spread (US minus German 10 yr yields) hits 43 bps, the highest since August and breaking above its 200-day MA for the 1st time since July. US-JPN 10- year spread hits 7-month high at 2.20%.
The USD attempts further stabilization after Mondays double blow from Moodys cautious remarks about the US triple AAA rating in light of Obamas tax cuts and lack of interest rate hike from China. Markets continue to anticipate an increase in Chinese lending/borrowing rates in addition to the latest hike in reserve requirement ratios to address escalating inflation.
EURUSD has yet to confirm Mondays rebound as it must maintain a close above $1.34 for a convincing break above the 55-week MA ($1.3380). This is a case of technical failure justifying faltering fundamentals (lack of definite Irish agreement, prolonged dissent regarding Eurobond issue among EU and Fitch talk of a downgrade of Belgiums AA+ rating in light of political uncertainty). EURUSD remains vulnerable to retesting $1.3250, followed by $1.30. Euros woes are clearly shown against the franc, as EURCHF trades 60 centimes away from its all time low of 1.2765 reached in September. GBPUSD shedding 130 pts despite 6-month high CPI at 3.3% after failing the 55-day MA of $1.5895, coinciding with the 50% retracement of its $1.6296-$1.5490 decline at $1.5895. We expect a shortlived attempt to regain $1.5810s before gradually pulling back towards $1.5680.
Ashraf