
All eyes
and ears will be on the answers that Mr. Bernanke, the US Federal Reserve
chairman, gives in Congress later in the global day today (Wed May 22nd).
What is at stake is the fate of the US dollar, as keen interest exists in the
matter of the possible phasing out of Quantitative Easing. Any hint that the
aggressively accommodative stance of recent times is coming to an end will
cause the greenback to accelerate its rise.
A kite was
flown last week in the form of a Wall Street Journal article that raised the
strong possibility that QE might be coming to an end. However, speeches from
the leaders of two regional Federal Reserve presidents yesterday and the day
before, William Dudley from New York and James
Bullard from St. Louis ,
have given the impression that it is not going away anytime soon.
This is to
be expected. Even if the FED is considering the future of stimulus in the form
of bond buying or other measures, its members will be very careful to ensure
that this tendency does not cause volatility in the currency markets.
http://www.forexseas.com/
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