Dollar index:

The dollar index is trading firm after the Fed’s meet yesterday. The Federal Reserve yesterday met to discuss about the stimulus package and the economy and the rates going forward. This definitely cheered the markets up to a bit. But the markets cleared that rally in the afternoon session when the Fed said that it was doing nothing to improve the economy.

The fed focused on the unemployment data and said that it would buy treasuries in order to decrease the unemployment rate. This cheered the markets and the Dow Jones was up by about 0.75 percent in the afternoon trade. But the later statements from the fed made investors nervous and that dampened the sentiment among them.

At the end of the day, the Dow Jones closed flat at that 13250 mark. This would definitely cheer the dollar index and that has just happened. The dollar index was trading at 79.8, last time we checked. The dollar is quite strong and that is also the reason, gold fell 1 percent in today’s trade. There is a clear sign in the economy that it is turning around.

Dow Jones is trading at an important level and is nearly one percent from the yearly highs. Most of the global markets are trading at their yearly highs. The dollar index is trading at that important level of 80 which has been acting as a strong support for many days. The next crucial resistance of the dollar index is at 81.20.

Australian dollar:

The Australian dollar is also at a 4 month high on anticipation of some good news from the Federal Reserve. The Australian dollar is trading flat from yesterday’s close. The ASX was trading up and is at a 17 month high, which is great news for the Australian dollar. This is the sole reason why Australian dollar has been moving up.

Tim Waterer, CMC Markets foreign exchange dealer, said, “We saw a move higher by the Australian dollar and other currencies against a broadly-weaker greenback. Last night, it looked like we could have reached 106 (US cents), but comments from (Fed chairman Ben) Bernanke about the fiscal cliff doused some of that optimism.” The Australian dollar is in an uptrend as the economy in Australia is going up.

The data which is coming out of Australia is showing signs of improvement and that is why the dollar is rallying. Today, The ASX ended up flat because of the global as well as the United States markets ending flat. The Federal Reserve met yesterday and discussed about the stimulus package.

The Fed concentrated on the jobless claims data and the markets suddenly rose because he said that the Fed will be buying treasuries to reduce the jobless claims. Tony Morriss, ANZ head of interest rate research, said, “US bonds are weaker, and that\’s kept our market on the back foot. We\’re trying for figure out why, since the Fed has looked to extend easing, and has an easing bias.”

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Category: Finances
Keywords: Fed, Concentrates, Unemployment Data