Home
Calendar
FAQ
Search
Register
Log inDollar Backtracks After Fed Cuts 25 Basis Points [EUR/USD]
Dollar Backtracks After Fed Cuts 25 Basis Points [EUR/USD]
pipshunter on Thu May 01, 2008 2:56 am
Wednesday, April 30, 2008 2:37:00 PM - The dollar was on the defensive versus the euro and sterling after Wednesday afternoon's announcement that the Federal Reserve will lower its key overnight rate by 25 basis points to 2 percent.
It was a busy day leading up to the Fed's rate call. Before the opening bell on Wall Street, data showed the U.S. economy continued to see modest growth in the first three months of 2008, according to a report released by the Department of Commerce on Wednesday.
The report showed that gross domestic product increased at an annual rate of 0.6 percent in the first quarter, matching the growth seen in the fourth quarter. The increase came in slightly above economist estimates of an increase of about 0.4 percent.
Also Wednesday morning, Automatic Data Processing, Inc. (ADP) released its report on private sector employment in the month of April, showing that employment unexpectedly increased compared to the previous month.
ADP said that non-farm private employment increased by 10,000 jobs in April following a downwardly revised increase of 3,000 jobs in March. Economists had expected the report to show a decrease of about 60,000 jobs.
The dollar rose its highest in 4-weeks versus the euro, extending a week-long uptrend. The buck hit 1.5516 in early dealing before slipping back to 1.5590 after the Fed's rate call.
A report from the European Commission revealed that Eurozone's economic confidence weakened more-than-expected to 97.1 in April from 99.6 in March. Economists had expected a level of 98.9 in April. Among others, the industrial confidence indicator declined to minus 2, while economists expected a reading of minus 1.
The dollar fell sharply against the sterling and extended its losses after the interest rate call. The buck dropped to 1.9874 from a 2-week high of 1.9622, paring most of yesteraday's gains.
Traders considered a report from the Nationwide building society showing that UK house prices dropped 1.1% month-on-month in April, bigger than the 0.7% fall in March.
The buck touched a 2-month high of 104.86 in early dealing versus the yen, but levelled off from there. The Bank of Japan left its key interest rate at 0.5 percent overnight, dropping its rate-raising bias.
It was a busy day leading up to the Fed's rate call. Before the opening bell on Wall Street, data showed the U.S. economy continued to see modest growth in the first three months of 2008, according to a report released by the Department of Commerce on Wednesday.
The report showed that gross domestic product increased at an annual rate of 0.6 percent in the first quarter, matching the growth seen in the fourth quarter. The increase came in slightly above economist estimates of an increase of about 0.4 percent.
Also Wednesday morning, Automatic Data Processing, Inc. (ADP) released its report on private sector employment in the month of April, showing that employment unexpectedly increased compared to the previous month.
ADP said that non-farm private employment increased by 10,000 jobs in April following a downwardly revised increase of 3,000 jobs in March. Economists had expected the report to show a decrease of about 60,000 jobs.
The dollar rose its highest in 4-weeks versus the euro, extending a week-long uptrend. The buck hit 1.5516 in early dealing before slipping back to 1.5590 after the Fed's rate call.
A report from the European Commission revealed that Eurozone's economic confidence weakened more-than-expected to 97.1 in April from 99.6 in March. Economists had expected a level of 98.9 in April. Among others, the industrial confidence indicator declined to minus 2, while economists expected a reading of minus 1.
The dollar fell sharply against the sterling and extended its losses after the interest rate call. The buck dropped to 1.9874 from a 2-week high of 1.9622, paring most of yesteraday's gains.
Traders considered a report from the Nationwide building society showing that UK house prices dropped 1.1% month-on-month in April, bigger than the 0.7% fall in March.
The buck touched a 2-month high of 104.86 in early dealing versus the yen, but levelled off from there. The Bank of Japan left its key interest rate at 0.5 percent overnight, dropping its rate-raising bias.
pipshunter- Senior Member
- Number of posts: 39
Registration date: 2008-04-01 
Permissions of this forum:
You cannot reply to topics in this forum