US ($) Currency Thread 1 (closed - use thread 2)

ratkarth

http://news.bbc.co.uk/1/hi/business/7965518.stm

surely this can only help matters..

inspector_monkfish

mng

climbed steadily from the overnight low of 1.4422, to reach a high of 1.4492 before coolapsing at 6.30am back down to 1.4428.

climbed back up sharply since then to trade around 1.4470 right now

inspector_monkfish

ratkarth wrote: »

http://news.bbc.co.uk/1/hi/business/7965518.stm

surely this can only help matters..

IF it happens, yes!
but its a big IF !!

we all saw what happened when Geithner let slip about this on wednesday, before he quickly retracted what he had said....

inspector_monkfish

before collapsing again to 1.4440 !!

inspector_monkfish

07:23 27Mar09 Gbp looking downside again, first stops through 1.4420

07:22 GMT - In otherwise fairly steady broader market trade, [GBP] looks the
most vulnerable of the majors at this juncture. Cable opened in Europe
below the psychological 1.45 mark, while most crosses are on the back foot
too. Stops are said to be in place both sides, but those to the downside
and reportedly through 1.4420 and 1.4395/00 could be the greater present
focus.

A big data day here though no revisions are expected to the -1.5%
q/q and -1.9% y/y last estimate for final UK Q4 GDP. The C/A balance too
is expected to decrease once more to Gbp 5.9bln. Early European flows
give credence to our initial view. Cable is already down 20 points or so
at 1.4440/45.

Due at 9.30am.

BernardM

inspector_monkfish wrote: »

IF it happens, yes!
but its a big IF !!

we all saw what happened when Geithner let slip about this on wednesday, before he quickly retracted what he had said....

Geithner’s double-dealings are nothing less than traitorous. While publicly downplaying the demise of the dollar and the birth of a global currency, his every action is greasing the skids for that very scenario to unfold. In the meantime, he’s careful to assure the anti-American fifth column Council on Foreign Relations, who have vehemently lobbied for a global currency, that the agenda for a world monetary union, a key cog in the pursuit of world government, is right on track.

BernardM

Obama, Geithner and Bernanke are the three biggest culprits behind the destruction of the dollar and are culpable for creating the perfect storm for its replacement with a new global reserve currency - so for all three to claim that they support a strong dollar and oppose a global currency is like Bernie Madoff lecturing you that Ponzi schemes are immoral.

inspector_monkfish

just bounced off the 1.4420 resistance level again
and rebounded to 1.4450

inspector_monkfish

been whipping around all over the place, and finally fallen through the 1.44 floor......:eek:

now trading at 1.4395, but its very very volatile...

inspector_monkfish

just found this interesting article......

- - - - -

08:15 27Mar09 Forex Focus: The Dollar Should Ignore The SDR Debate


LONDON The debate over the dollar's role as the global reserve currency may well be heating up.
But that doesn't mean the dollar itself should suffer.

The market has long been aware that many central banks, including the very
powerful Peoples Bank of China, have been diversifying their holdings into other
currencies, such as the euro and the yen.

This is a process that's likely to continue as central banks worldwide look
to spread the risk in these more uncertain times.
However, there's little reason to see this diversification process
accelerating at a time when reserves are slumping. If anything, recent data
suggests that central bank demand for U.S. Treasurys is even stronger than it was before.

So, what about the PBOC's suggestion that the world should be moving toward
adopting a currency linked to the IMF's basket currency - special drawing rights, or SDR.

U.S. Treasury Secretary Timothy Geithner's suggestion that he might be "quite
open" to such a discussion sent currency markets into a spin earlier this week
before Geithner quickly made it clear that he still sees the dollar as the prime
reserve currency.

The PBOC's suggestion is hardly surprising given the rising fear of inflation
as the U.S. and other major economies adopt quantitative easing. With over $2
trillion in reserves at stake, the Chinese are understandably nervous if U.S.
policies are likely to undermine global confidence in the dollar.
Any shift into SDR's would also be pretty traumatic for the U.S. currency.
With 65% of global reserves now held in the dollar, but with the U.S. currency
providing only about 44% of an SDR, this would involve a steep selloff in
dollar-denominated holdings.

Strategists at BNP Paribas estimate this could amount to a $1.2 trillion
decline in foreign investment in U.S. Treasury and agency paper.
Thus, the dollar's sensitivity to any suggestion of the SDR being used as a
reserve currency is hardly surprising.
But, any such shift is hardly likely in the foreseeable future and the topic
isn't even on the agenda for next week's G20 summit in London.

For a start, as a non-currency currency, the SDR hardly provides the sort of
liquidity needed for a global reserve currency. Also, as a non-currency currency,
the SDR doesn't have adequate fixed-income offering that central banks seeking a
new home for their reserves would need.

Also, there is the enormous issue of China's own role in the SDR.
Neil Mellor, a senior currency strategist with Bank of New York Mellon in
London, pointed out if China's role was to increase, China would have to
relinquish control of its capital account and let the yuan float freely,
something the PBOC has been loath to allow despite pressure in recent years from
the U.S.
Then, there is also the issue of China's greater participation in the IMF,
which would involve an increase in contributions.

"It is difficult to believe that China would sign up to such a system without
a significant say in its politics," Mellor said.
So while, SDR's may remain a topic for heated discussion, any early move
toward adopting a new reserve currency is totally unlikely and any progress
toward such an eventual move is likely, as Deutsche Bank said, to be "glacial."

And as far as the dollar is concerned, it can relax.
Early Friday, the prospect of next week's G20 meeting combined with month-end
trading appear to be prompting some book-squaring with the dollar falling against
the yen and the euro.
Worries about deflation pressures growing in Japan weren't helping the yen.

Nevertheless, the dollar had slipped to Y97.94 by 0745 GMT from Y98.71 late
Thursday in New York, according to EBS.

The euro fell to Y132.91 from Y133.31, but rose to $1.3572 from $1.3508.