Dollar Perceived As Safe Haven

The US dollar rose on Thursday due to the perception that the dollar is a safe haven in times of economic crisis and has provided Forex opportunities throughout the global financial crisis. The British pound, on the other hand, fell amid news of massive losses by the Bank of Scotland and the perception that the British banking sector is in more trouble than was previously thought.

Treasury Nominee Speaks

The dollar also benefited from a comment by U.S. Treasury Secretary Nominee Timothy Geithner who stated his belief that a strong dollar is in the U.S. interest. Geithner made the remarks to the Senate Finance committee during confirmation hearings. A strong dollar means more Forex opportunities for both traders and investors. Both the house and the senate are expected to approve his appointment as Treasury Secretary.

Dollar Down Against Yen

The dollar was down against the yen after a report showed a larger than expected increase in the number of U.S. workers filing claims for unemployment benefits. The US lost about a million jobs in 2008 and markets reacted to the news that Microsoft will trim 5,000 jobs over the next 18 months and reported that earnings and sales were below expectations.

Yen’s Gains Limited

Gains in the Japanese currency were limited; however, as investors were on alert for possible intervention after Swiss officials issued similar warnings. The Yen is approaching a 13 year high against the Dollar and achieved a 7 year high against the Euro on Wednesday. Traders and investors continue to take advantage of the safe haven and Forex opportunities that the Yen has provided throughout the global economic crisis. Omer Esiner, senior market analyst at Ruesch International stated, “On balance, the dollar is not expected to fall too much because the market has been bracing for dismal news anyway. Bad news out of the euro zone and Japan has benefited the dollar and that should continue despite bad U.S. economic data.”

Credit Downgrades in Euro Zone

The Euro has been damaged by three rating downgrades of euro-zone countries within a week. Standard & Poor’s downgraded Portugal’s sovereign rating on Wednesday after downgrading Spain and Greece. Despite all the bad news there are always Forex opportunities for those who pay attention and do the necessary research.

Quick Forex Tip: The forex market offers investors the opportunity to profit even during a recession. If one currency rises another must fall creating constant opportunities for savvy investors to profit from currency moves. It is not difficult to learn how to trade forex currency and there are many very well written and user friendly learning programs and training courses available for free on the internet.  Besides training, the most important thing those who trade forex currencies must learn to follow political and economic news and interpret the results and the affect current events will have on forex markets.