Forex news – the growth of the USD
The United States currency experiences growth caused by high numbers of employment index and possibility of the Federal Reserve to increase the liquidity at the financial markets with the help of the Term Auction Facility auctions extension and Fed’s agreements with Central banks of other countries.
The Fed’s intention is to increase TAF auctions from $50 billion to $75 billion and extend its swap agreements wit central banks of Eurozone and Switzerland.
According to Hans Redeker, who is the head of Forex strategy at BNP Paribas the situation occurred makes us think that the Federal Reserve concentrates on the means of increasing liquidity and not on the rate cuts. Mr. Redeker added that the actions aimed at the eliminating credit crisis consequences may contribute to the growth of the risk appetite. He said that theses actions will be quite positive for the equity markets and contribute to the recovery process of the US economy and as a result strong and firm United States dollar.
As for the exchange rates the Euro/USD has decreased to the 1.5400 at the afternoon as well as the British pound decreased to the level of 1.9891. Another positive data was in the lower April jobless numbers than it was expected.
