Dollar Continues To Trade Down
September 14, 2007
The dollar has fallen to near record lows against the euro as the US economy is poised to hear data that indicates the depth of the sub-prime lending crisis.
The value of the dollar was at $1.3870 to the euro among fears of the pending outcome of retail sales data, which analysts are predicting will hold the key to the extent of the damage in the sub-prime sector.
Further, with the prospect of an interest rate cut to bring stability to the markets, currency investors have turned away from the dollar in trade through Asian markets over the course of today.
The retail sales data is expected over the course of this week, and analysts are suggesting that it could indicate whether or not the trouble in the sub-prime crisis has had a bearing on consumer buyers.
The results of the data are likely to have a significant impact on trading on the US markets and indeed across the world, with analysts literally hanging on the results as providing some indication of the range of the troubled market.
Analysts have already suffered the impact of an unexpected loss of 4,000 jobs last month, despite predictions that employment figures would actually rise by 11,000 over the same period, sending market trading into turmoil and significantly hindering investor confidence for the short term.
Forecasts are currently suggesting that sales will rise by 0.4% from the month, up from 0.3% last month. Any rise short of this is likely to send markets into further turmoil, as an indication that over exposure to the sub-prime sector could have spread to consumer sectors.
With expectations suggesting the Federal Reserve could cut rates by two steps down to 5.25% and the potential for further market upset, the dollar has weakened significantly over consecutive sessions, taking it near record lows.