Thursday, 29 Apr 2010

Gulf Oil Leak Raises Price of Crude; EUR Gains, but Worries Persist

Although risk aversion seems to be a dominant theme in trading this week, the EUR was able to pare a small amount of its recent losses. As the market chews on the latest updates from the Greek bailout proceedings, it seems the EUR has gained from natural market fluctuations, especially considering some relatively positive data from the Euro-Zone and Britain.

As a result of this uptick in the EUR, we see the US Dollar coming down a bit versus many of its primary rivals. Due to this sudden weakness in the greenback, traders are also witnessing a rise in commodity prices. Gold prices continued to rise as risk aversion took hold this week and, even though the Dollar was on the rise, Gold prices continued to gain in prominence among investors.

The oil leak in the Gulf of Mexico from a deep-well drilling rig may also have a limited impact on the price of Crude Oil. Given the rising prices of commodities, the news of this oil leak may have put a small number of speculators into the buy column of Crude Oil as supply is obviously being hampered somewhat. As a result, traders should also see the value of commodity-linked currencies - such as the NOK, CAD, and AUD - gain in strength towards the end of this week's trading session.