Once again the USD traded within a range bound consistency, but did lose some ground to the EUR and GBP. Wall Street struggled on Wednesday and this occurred with little in the way of economic data. Ben Bernanke spoke at a Federal Reserve conference in Richmond and issued warnings about the lack of private sector growth and its implications. Bernanke also went on to say that the U.S. does face risk from the European debt crisis and that the Federal Reserve is poised to counteract negative impacts. He additionally spoke about the size of budget deficits in America and the potential for this debt to come back and haunt the economic landscape if not acted upon. Thus investors were given another spoonful of less than optimistic rhetoric, and this time it was from someone they have come to rely on to give a more optimistic viewpoint.
Today the U.S. will release weekly Unemployment Claims and the numbers are expected to improve slightly. Trade Balance data will also be published. The jobless situation remains a primary concern among investors as they continue to ask where job creation will come from. Tomorrow Retail Sales figures and the Prelim Consumer Sentiment reading are on the calendar. Wall Street has for the most part traded in negative territory all week, and going into these last two days of the week will somehow look for an opportunity to bounce upwards. However, with a slew of negative sentiment abounding, an equity rally may prove difficult without a good surprise from economic data and where that will come from is hard to guess. The USD has traded in a cautious manner this week and has actually lost some ground to the EUR, but the fact remains that the Greenback is within the stronger parts of its range versus the Single Currency. Thus traders going into these last two trading days will have to be prepared for additional short term movements, which could reverse on a dime if risk adverse sentiment suddenly increases.
Written by bforex.com
