The USD lost ground to the EUR in early trading on Monday as the effects of the Basel III accord brought clarity into the markets – supposedly. The U.S. did not release much in the way of data yesterday leaving the broad markets without much direction as the day progressed. Sentiment remains fragile and investors may be gearing themselves towards today’s Retail Sales figures, which are supposed to nearly match last month’s outcome. Tomorrow the Empire State Manufacturing Index and Industrial Production numbers will be brought forth. Traders on Wall Street have thus far enjoyed a good September and the today’s Retail Sales figures could have an impact.
The crux of the matter for investors remains the economic prospects for the States. Warren Buffet was quoted yesterday as saying he believes that the U.S. economy is not about to suffer a double dip recession and that his portfolio of companies within Berskshire Hathaway are performing well and have good outlooks. The Basel III accord that was hammered out over the weekend may have given the markets some support as investors continue to seek any signs of financial stability. But as always, the proof will have to be in the pudding for the new banking regulations, and with plenty of time to comply there is little in the way of hardship being spoken about now. The big question down the road is what will be allowed to be counted as capital when accounting for reserve totals and that remains unanswered. The USD has found itself losing some ground to the EUR, the JPY, and commodity based currencies, but it may prove difficult to critique the short term marketplace. Retail Sales numbers will be watched closely today to in order to gauge the tenacity of the American consumer and what it means for the American economy.
Written by bforex.com
