quenchmaster
11-10-2004, 06:09 PM
Of course everyone know's the rate hike. What does it mean? What is the reaction around the world. It appears a wiggle is in motion. Europe is holding tight. Oil rose slightly with the announcement of the $50B. The EURO rose to a new high. What does it all mean...Some comments from the EUR Market and others.
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he latest rally has taken the euro from about $1.20 two months ago to today’s level, prompting European Central Bank President Jean-Claude Trichet to call the surge “brutal” earlier this week.
The general feeling now is that the currency will remain around the current level, before beginning a more gradual rise next year, said Carsten Fritsch, an economist at Commerzbank in Frankfurt.
“I think for a lasting break of this $1.30 we will need some fresh disappointing news from the United States,” he said. “Our focus is $1.35 by mid-next year and $1.32 by the end of the first quarter.”
Bloom forecast a euro level of $1.35 within the next six months.
For the 12 countries that use the euro, the stronger currency raises fears that it will snuff out their moderate, export-driven economic recovery by making exports more expensive. But it takes much of the sting out of high oil prices on the continent, since oil is priced in dollars and the strong euro makes it relatively cheaper.
For Americans, consequences include higher prices on imported goods and more expensive European vacations. But a weak dollar can be a boon to U.S. manufacturing exporters, making their goods cheaper compared to those of European competitors, and fattening overseas sales and profit margins.
Although the Bush administration says it has a strong dollar policy, most analysts think the White House doesn’t mind a lower dollar because that can help U.S. economic growth and jobs.
Experts say that as the slide of the dollar continues, international money managers and foreign central banks will be less likely to buy U.S. stocks and bonds.
“The U.S. has got these massive deficits that nobody wants to buy into,” Bloom said. “It needs everybody to be buying dollars all day, every day, and the world doesn’t want to do that.”
I'm staying the course, you've got to expect wiggles. Risk apears to be fairly equal across C, S, & I. F is junk for now, and G is always a haven for the weary. C=40, S=40, I=20. Expectations... Jobs will increase leading into the holiday season, dollar is weak with no indications of getting better...another check for the bull...
.
he latest rally has taken the euro from about $1.20 two months ago to today’s level, prompting European Central Bank President Jean-Claude Trichet to call the surge “brutal” earlier this week.
The general feeling now is that the currency will remain around the current level, before beginning a more gradual rise next year, said Carsten Fritsch, an economist at Commerzbank in Frankfurt.
“I think for a lasting break of this $1.30 we will need some fresh disappointing news from the United States,” he said. “Our focus is $1.35 by mid-next year and $1.32 by the end of the first quarter.”
Bloom forecast a euro level of $1.35 within the next six months.
For the 12 countries that use the euro, the stronger currency raises fears that it will snuff out their moderate, export-driven economic recovery by making exports more expensive. But it takes much of the sting out of high oil prices on the continent, since oil is priced in dollars and the strong euro makes it relatively cheaper.
For Americans, consequences include higher prices on imported goods and more expensive European vacations. But a weak dollar can be a boon to U.S. manufacturing exporters, making their goods cheaper compared to those of European competitors, and fattening overseas sales and profit margins.
Although the Bush administration says it has a strong dollar policy, most analysts think the White House doesn’t mind a lower dollar because that can help U.S. economic growth and jobs.
Experts say that as the slide of the dollar continues, international money managers and foreign central banks will be less likely to buy U.S. stocks and bonds.
“The U.S. has got these massive deficits that nobody wants to buy into,” Bloom said. “It needs everybody to be buying dollars all day, every day, and the world doesn’t want to do that.”
I'm staying the course, you've got to expect wiggles. Risk apears to be fairly equal across C, S, & I. F is junk for now, and G is always a haven for the weary. C=40, S=40, I=20. Expectations... Jobs will increase leading into the holiday season, dollar is weak with no indications of getting better...another check for the bull...