"In my view, the adverse dynamics of the financial markets and the economy have presented the greater threat to economic welfare in the United States," These what Kohn Fed's Vice president said to add to the greenback woes. The single currency get boosted from today's upbeat IFO data underpinned versus the US dollar by a continued series of US consuming weakness as the US Consumer confidence came magnificently low following the US UN Michigan advanced reading of Jan to ensured Khon view and to settle the dovish sentiment in the currency market towards the greenback and the the recessions worries. The Fed's main attention is paid to the growth not inflation inspite of recent considerable high inflation rates as Dec CPI came at .4% higher than the market expectations of .3% also the yearly figure came
4.3% just above the market expectations of 4.2% and the core was also just above the market forecast of .3% at .4% monthly. The US inflation rates have reached its the fastest pace in over two years last November too and last week release of Jan came also just .1% above the market expectations of just .3% m/m and today's PPI was also higher than expected the core rate was .4% and the broad figure was1% showing that the inflation is actually building up and it is serious and the energy prices are really a challenge at this part of the economy cycle.. The market bought the gold again on this pushing it to 950$ and the single currency just shy now of penetrating 1.50$ and it is expected to do as Ben Bernenke's speech ahead and this Fed's dovish sentiment can persist.Best wishes
FX Consultant Walid Salah El Din Mob: +20 12 465 9143 E-Mail: snipped-for-privacy@fx-recommends.com