Tag: value of dollar

It was not even a few months ago that Europe’s sovereign debt crisis had worked investors into a frenzied panic over sovereign risk. At the time, all signs pointed to the dollar being the currency of choice. Benjamin Franklin smiled strongly from the face of paperbacks and he had good reason to; Uncle Sam was faring exceedingly well against the yen, the pound and the euro. The dollar was safe in its role as the world’s reserve currency of choice, and it was the safest bet for investors looking for a haven for their money. In the land of the blind, the one eyed man is king and the US Dollar reigned supreme despite the domestic economy looking shaky. The dollar was all set to stage a rally. How a few months can change everything. It was August 11th when the American dollar collapsed to a 15 year low against the Yen’s value of ¥84.7. The dollar has similarly lost much ground to the  [...]

Maybe just a small blip in dollar’s downward slide but definitely worth noticing. The dollar on Tuesday  rebounded from its 15 month low on Monday. Looks like Federal Reserve Chairman Ben Bernanke comment in favour of strong dollar helped the currency as traders trimmed longer-term bets against the currency. On Monday Bernanke commented that the Fed is very much looking into the implications of changes in the value of dollar as US interest rates reach rock bottom levels. This was interpreted by traders as an indication that the Fed is worried about the current depreciation which can increase inflation in the economy. European Central Bank President Jean-Claude also came in support of the dollar. He clearly mentioned that a strong dollar is in the U.S. interest and that there are no plans for euro to act as a reserve currency in the near future. The impact of this interpretation was  [...]