There wasn't any economic report released from the U.S. luckily for the dollar, risk aversion dominated market sentiment in the last
two days.
It seems that we're seeing investors are turning their focus to economic data. Market
participants are starting to realize that the all the stimulus measures that
central banks from all over the world are nothing to be happy about. They were
started because the economy was in the dumps, and that's not something to be
optimistic about.
The market haven't been too kind to the Euro over the past week or so. In fact, they've been selling it off at a pretty steady pace ever since excitement over QE3 died down.
Euro still under pressure as German Chancellor Angela Merkel
and French President Francois Hollande clashed over a timetable for starting
joint oversight of European’s banks. News that Greece might be facing a
shortfall in its budget and Spain's refusal to ask for a bailout also weighed
down on sentiment.
Disappointing economic data from Germany also hinted that the
country could be headed for a recession.
Traders seem to have their eyes on the three euro zone
countries because more bad news could intensify risk aversion and send the
dollar even higher.
The minutes of the most recent BOJ meeting reiterated the
central bank's concerns about the yen's strength. The BOJ's actions still not
comparable in terms of the size to those of the Fed and ECB. So I guess it
wasn't much of a surprise to see the yen ignore the dovish minutes.
Of course, it also helped the yen that risk aversion
dominated market sentiment on renewed concerns about the euro zone.
Tonight, At 8:00 the S&P house price index for July is
anticipated to show that house prices increased by 1.3% during the month. Then
at 9:00 pm, Conference Board's consumer confidence report for September will be
released. The consensus is for an increase of 63.1. Those will probably affect the currency's price action.
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