The consensus among economists is now that the US Federal Reserve Bank will lower its benchmark interest rate all the way to 0%. The Fed Funds Rate currently stands at 1%, and two projected 50 basis point cuts within the…
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Fed to Lower Rates to 0%
November 22nd, 2008 · No Comments
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US to Continue to Pressure China Over RMB
November 21st, 2008 · No Comments
After rising nearly 20% over the last three years, the RMB has virtually stopped appreciating against the US Dollar, perhaps as a result of the credit crisis. At the same time, the US exports sector- previously one of the few…
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Canadian Dollar Rallies on FX Market
November 21st, 2008 · No Comments
Loonie gains in currency tradingThe Canadian dollar is rallying on the FX market today. Thanks to some help from an improving stock market, sentiment is favoring the loonie in currency trading for the first time in quite a while.
However, the Canadian dollar is still a ways from parity with the U.S. dollar, and has fallen quite far from its decades-high peaks around the beginning of 2008.
This stimulation of the Canadian economy may result in dialing back speculation that the Bank of Canada will cut interest rates.
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- Loonie in Currency Trading
Trading on the FX market
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Forex Trading Terms: High Yielders
November 21st, 2008 · No Comments
High yielding currencies on the FX marketOne of the forex trading terms that you might have come across recently is "high yielders." This refers to currencies that have high interest rates attached to them.
Interest rates are set by central banks. The higher the rate, the higher the yield. High yielders are popular because they benefit from the carry trade. Low yielding currencies are used to fund their purchase.
During times of risk aversion, the risky process of borrowing to purchase a currency (and hoping to make money on the difference in interest rate) is shunned. However, when markets improve, traders feel more risk tolerance and high yielders are favored.
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- Forex Trading Help
Learn the FX market
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Stock Rebound Gives Life to Currency Market
November 21st, 2008 · No Comments
U.S. Dollar, Japanese Yen drop in forex tradingYesterday and earlier today, risk aversion was affecting the currency market and sending high yielders lower, as well as providing impetus for traders to turn to the U.S. dollar and the Japanese yen.
But, like all things in forex trading and other volatile markets, the story is changing. The latest news from the banking sector is sending the stock market higher, and that is improving risk appetite.
And as risk appetite improves, high yielders are more in demand as currencies like the U.S. dollar and the Japanese yen fall to the wayside.
See Also
- U.S. Dollar in Forex Trading
Trading on the currency market
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