Forex updates- Dollar Weakens on Positive Economic News

On Friday the USD closed much weaker against all of the other major currencies, better than expected NFP reports. The recent optimistic global economic news has assured traders that the most terrible of the recession possibly will be over. Traders are moving away from the greenback in favor of riskier, higher yielding assets making market sentiment dollar negative. Equity markets moved higher up with the DOW gaining triple digits and the S&P adding 20 points. The Euro rushed on Friday, it broke all the records of 200 day simple moving average, and closing above the 1.3600.

Since January 2009 the pound closed at the highest level, it hiked at 230 pips on Friday. The pound strengthened against the dollar as the greenback weakened across the board after the employment figures was released and after traders’ worries were calmed with the release of the stress test results.

The Australian Dollar (Aud/Usd) strongly gains all the benefits on Friday after positive news about the stress tests and global equity markets. The pair gained approximately 150 pips, closing above 0.7650 and added 365 pips for the week.

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US Futures Declined at a Strong Pace, But Asian Market Rise

US Futures post significant decline tonight, although Asian markets are trading in the green. The main cause of concern seems to be the swine flu that just hit the US borders.

It seems that the swine flu is the problem to hit the US and the global financial system. For now, the investors are anxious that the cost of combating the new disease will only add another streak on the government’s budget, already influenced by the huge rescues that financial sector requisite. Also, like this time, consumers tend to spend less, which will also affect the business cycle rising significantly the recovery period. Experts said.

However, Asian equity markets seem unaffected up to now, reaching the maximum valuation in the last three months of trading. The financial sector constant to progress tonight, helped by the unofficial, preliminary stress test outcomes, which show that most banks have a sufficient capital base. Equally with the financial sector, pharmaceutical companies also placed some major gains tonight, as drug sales are possibly to raise up.

Additionally, the Japanese government decreased yet again the GDP projections for 2009, down to 3.3%, something that should have pulled the Asian markets worse.

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