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12 Jul 2013
Flash: USD weakness subsides for now? – Investec
FXstreet.com (New York) - US equity markets marched on to all time highs recently as the reaction from markets to Ben Bernanke’s comments on Wednesday evening continued to unfold, notes Lee McDarby, Corporate Treasury at Investec.
According to McDarby, “The possibility of the liquidity taps remaining on longer than expected as a result gave equity markets a new found confidence that excess liquidity is here to stay for a little longer.” Emerging markets have also been major beneficiaries, with yesterday marking their strongest gains in almost a year. “The USD remains on the back foot and held above 1.3000 and 1.5100 against the euro and pound respectively, which is a short term signal that the barrage of US dollar buying prior to Wednesday evening may have subsided for now.” McDarby adds.
According to McDarby, “The possibility of the liquidity taps remaining on longer than expected as a result gave equity markets a new found confidence that excess liquidity is here to stay for a little longer.” Emerging markets have also been major beneficiaries, with yesterday marking their strongest gains in almost a year. “The USD remains on the back foot and held above 1.3000 and 1.5100 against the euro and pound respectively, which is a short term signal that the barrage of US dollar buying prior to Wednesday evening may have subsided for now.” McDarby adds.