Thursday, 21 Oct 2010

Forex: Geithner to Use G20 to "Rebalance" World Economy

The US dollar fell slightly against most of its major currency rivals today after positive data was released from China and Germany which pushed the dollar down. The euro continued its strong run, trading back solidly above 1.4000 against the USD.

The widely-anticipated resumption of a bond purchasing program by the Fed, which would flood the market with dollars and devalue the currency, remains the strongest force guiding investors. That, and signs of global growth outside the US, have combined to push the dollar lower over the past few weeks.

The greenback backed off from a momentary surge during Asian trading this morning, after Treasury Secretary Timothy Geithner's comment that he would use this weekend's G20 meeting to seek ways to "rebalance" the world economy, with particular reference to the currency market.