Will FED Cut on Tues, 18 Mar 2008 save the US$?

Posted on March 18, 2008
Filed Under Forex News |

On Mar 08, I wrote the post How Low can the US Dollar Goes?

After a week, it turned out that my sentiment toward the US$ was right. The US dollar has plunged to a 13 years low against the Japanese Yen at around 99.03, broken the psychological 100 barrier. The Euro has also traded at all-time high versus the US dollar at around 1.5667.

Many market players said it could have been worse for the US dollar if not for the expectation that FED will cut its interest rate by a full percentage point to 2 per cent during its meeting on Tuesday, March 18, 2008.

I can’t imagize what will happen if FED decides to cut its interest rate less than a full percentage point.

At the current junction, many economists believe that it may be wishful thinking that the FED could save the day. To complicate the matter, many market players may even take more FED interest rate cuts as a sign of more weakness ahead.

Cheers, Kampai, Proscht^^!!