Tuesday, 29 Jun 2010

Dollar Falls versus Yen on Consumer Confidence Data

The U.S. dollar extended declines versus the Japanese yen on Tuesday after a report showed U.S. consumer confidence fell steeply in June after rising for three months. The USD fell 1% against the yen to trade around 88.60. The EUR also extended declines, falling more than 1% against the dollar to trade at 1.2190.

Data showed confidence among U.S. consumers declined in June more than forecast as Americans became pessimistic about the outlook for the labor market and the economy. The Conference Board's confidence index slumped to 52.9 this month from a revised 62.7 in May. Job growth that may be slow in bringing down the unemployment rate and declining stock prices tied to Europe's debt crisis threaten to restrain consumer spending. The lack of stronger gains in the biggest part of the economy reinforces the Federal Reserve's forecast for a “moderate” recovery.

Tomorrow, forex traders cannot afford to overlook, a batch of data is expected from the leading economies. Both the British Nationwide HPI and ADP Non-Farm Employment Change will be released at 6:00 GMT and 12:15 GMT respectively, promising an extremely volatile trading day. Traders should take advantage of this unique opportunity and use the volatile market in order to capitalize profits.