US dollar is inching higher today, eking out some gains after earlier softness. With the latest news out of the eurozone designed to weigh on high beta currencies, greenback is seeing some small demand right now.
Earlier, the US dollar showed some softness as other currencies took center stage. However, the greenback is now making some headway as risk aversion comes creeping back. Weakness in the eurozone and in the United Kingdom is recommending the greenback to Forex traders.
Contraction was seen in manufacturing for the 11th straight month, even though some of that has eased. October retail sales were disappointing, though. There is no sign that the eurozone will be out of the recession anytime soon, and it doesn’t look good on the political front, as wrangling over a banking union continues.
In the United Kingdom, there are concerns that the AAA credit rating could be lost. Problems still abound there, with George Osborne‘s austerity program not reducing the deficit, and with the economy still sluggish.
Even though the United States has its own problems, and the economic recovery isn’t going as well as many would like, it still looks a little bit better than the current situation in the eurozone and Britain.
At 14:22 GMT EUR/USD is down to 1.3065 from the open at 1.3094. GBP/USD is down to 1.6088 from the open at 1.6102.
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