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Commodities in 2009
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newsaver2008 wrote: »As everyone is asking, as the Fed have cut the interest rates to nil and their economy is supposed to be in worse shape, how come the pound is dropping EVERY day??
Because it is not, at least not against the dollar. Here is a chart showing the last 3 months - as you can see it has flattend out. That's not because the £ is strong, it's because the $ is just as weak.
In particular the latest drop in US interest rates caught the market by surprise, whereas a further drop in UK rates is already priced in. European rates are not expected to drop as much so their currency is stronger than ours. That could easily change though. Exchange rates are priced on predictions of what lies ahead and they don't always get it right.0 -
Uncle Ben is well known for his preference to a weaker dollar in this climate
It makes his rice cheaper :rotfl: :rotfl:'In nature, there are neither rewards nor punishments - there are Consequences.'0
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