Tuesday, 1 Jun 2010

Riskier Currencies Receive Boost From Positive Economic News

Riskier currencies made a comeback virtually across the board today, as a series of news events boosted investor confidence in the global economic recovery. Following the news that Canada raised their interest rates from 0.25% to 0.50%, USD/CAD fell some 65 pips, reaching as low as 1.0457. The pair has made a slight upward correction, and is now trading around the 1.0495 level.

Additionally, the U.S. ISM Manufacturing PMI showed a better then forecasted expansion in the American manufacturing sector. Consequently, investors returned to risk taking and the Euro and British Pound were able to make gains on the greenback.

Tomorrow, traders will want to pay attention to both the Swiss Retail Sales and U.S. Pending Home Sales reports. Analysts are forecasting a drop in both figures. If true, investors may end up turning back to the safe-haven Dollar and Yen in trading tomorrow.