Monday, 23 Aug 2010

Dollar and Yen Continue To Rally

The U.S. dollar and the Japanese yen continued to strengthen against the euro and the British pound today. The dollar gained about 60 pips vs. both pairs. The yen saw similar profits against the European currencies as well.

The bullish trend of the dollar and the yen began on Thursday as data showed that the U.S. economic growth pace might be slower than expected. This has boosted concerns that the global economic recovery might be slowing down as well, and turned investors to seek for safer assets, such as the dollar and the yen. This trend continued today as well.

Looking ahead to tomorrow, the most significant news release looks to be the U.S. Existing Home Sales. This report measures the number of residential buildings that were sold during July. Analysts have forecasted that 4.68M buildings were sold. Traders should further disappointing data seem likely to further boost safe-haven currencies, such as the yen.