Dollar Rises On Safe Haven Status
The dollar is up this morning as global stock markets fall, and demand for the greenback picks up from it's perceived safe-haven status.
The FTSE 100 is down below 5,000 with banks leading the way, with RBS the biggest loser of the day, hitting the headlines once again for all the wrong reasons.
The German DAX and Paris CAC are also around 2% lower, mirroring earlier losses in Hong Kong's Hang Seng Index.
The pound has fallen below UDS1.63 this morning, partly after data today revealed that construction activity in the UK continued to fall in October.
It would seem that the general belief in the market is that the dollar will weaken further, possibly significantly so, and that almost every man and his dog is short the US unit.
With the advent of the collapse in global trade, the need for the dollars to pay for your iron ore, or wheat or oil etc, also diminished. It may be worth considering that if a global economic recovery IS underway, then a renewed need for dollars to pay for such commodities - combined with an already heavily short market - could lead to a sharp dollar correction.
The FTSE 100 is down below 5,000 with banks leading the way, with RBS the biggest loser of the day, hitting the headlines once again for all the wrong reasons.
The German DAX and Paris CAC are also around 2% lower, mirroring earlier losses in Hong Kong's Hang Seng Index.
The pound has fallen below UDS1.63 this morning, partly after data today revealed that construction activity in the UK continued to fall in October.
It would seem that the general belief in the market is that the dollar will weaken further, possibly significantly so, and that almost every man and his dog is short the US unit.
With the advent of the collapse in global trade, the need for the dollars to pay for your iron ore, or wheat or oil etc, also diminished. It may be worth considering that if a global economic recovery IS underway, then a renewed need for dollars to pay for such commodities - combined with an already heavily short market - could lead to a sharp dollar correction.
