Beige Book report pushes US dollar high against euro and sterling
Federal Reserve’s Beige book survey report pushed US Dollar up against the Euro and Sterling, on Thursday morning. The report explained that end of 2007 witnessed a modest growth in US economy, which eased the apprehensions of deceleration of the major economy of the world.Â
The Beige book survey by Federal Reserve on local economies showed a slow, but increasing economic activities between months of November to December.
The greenback was also found drawing support from the notice given by Yves Mersch, policy maker European Central Bank, on the slowdown of the growth of euro zone economic. The deceleration reduces the odds of any raise in the ECB interest rate.
According to John Noonan, an analyst Thompson IFR, the Euro sank down from 1.4815 US dollars to 1.4594 US dollars following the ECB’S caution about jeopardy surrounding the euro zone economy. John also expects a move by ECB on taking controlling steps in near future.
Economy related apprehensions got eased with the outcome of Beige report along with the report from Wells Fargo & Co [(NYSE:GWF) (NYSE:JWF) (NYSE:WSF) (NYSE:WPF) (NYSE:WFC)] and JP Morgan Chase & Co. The results also proved as assistance to Wall Street in trimming of its current losses.
John Noonan also said, that the Beige book report may have turned out pretty straight unlike the expectations of the economists and analysts, but the affable outcomes of the report did not completely ease anxiety surrounding the economic growth in US and worldwide.
Noonan also believed that New Zealand and Australian dollar are quiet vulnerable, while their economies have been moving with a growing momentum they could suffer if situation of lower commodity prices came (due to worldwide growth concerns). The New Zealand and Australian dollars are expected to act just like Canadian and sterling dollars did (when at the closing stages of year 2007 economies of Canada and UK started to fall).
The beginning of the day witnessed dollar buying 107.3 yen which was later 107.47 yen in the New York trade. While the sterling was down to 1.9614 as compared to 1.9632 US dollar, the euro came down from 1.4660 dollars to 1.4653 dollars.