I take a long weekend and the dollar goes in the dumper. Gerry leaves again and the pound loses its bid…Hmmm.
Catch-up is easy when you have two big stories to come back to. The story in the Independent on the “Demise in the Dollar” set the tone in Asia before the RBA lit a fresh fuse under the greenback with it’s surprising 0.25 rise in the overnight lending rate.
Equity markets have been underpinned by the fresh dollar weakness and traders are ignoring the denial by oil states that they intend to dump the dollar as their means of exchange. The reflation trade is alive and well as the EUR consolidates less than a quarter-cent below 1.4749 session highs.
Fresh dollar weakness has traders looking at the 1.4866 September 22,2008 highs recent highs at 1.4842 lay just below. We trade now at 1.4730.
