USD Loses Strength as Holiday Shopping Disappoints Retailers
Posted on 29. Dec, 2008 by admin in USD Analysis, USD Economic Analysis, USD News
After the Christmas holiday passed, many retail stores were expecting a small reversal to the recent economic slump seen around the world. Post-holiday shopping discounts usually lead to a vast increase in consumer spending. This year, however, the credit crisis and economic recession have consumers worried about home financing and individual savings more than holiday shopping, and retailers are feeling the pinch.
For the first time in decades economists are saying that we are heading for another Great Depression. With stocks continually sliding, sales dropping, and almost all global economies contracting simultaneously, these economists may not be far off with their assessment. It appears the one area left where investors can make money is in forex trading. By bailing out of weaker or lower yielding currencies and buying into safe havens, such as the USD or EUR, thereby driving their value higher, traders can make substantial profits.
The USD appears to have lost strength over the holidays and is now trading near the 1.4200 level against the EUR. Supporting this notion is the weakness of the Dollar against the Swiss Franc, which currently trades below 1.0600. Today’s rising Crude Oil prices may also indicate a depreciation of the greenback.
As far as USD trading goes, investors would be wise to pay attention to the movement of Crude Oil prices as well as the EUR this week as low volume holiday trading is still underway in the United States with the upcoming New Years celebration on Wednesday night.
