The US dollar to the sale at the beginning of European trading session because of the sales impact news with accelerated profits as a result of news that Chinese credit rating agency has downgraded the credit rating of A-to A. finally reached by us lawmakers to agree on the budget and the extension of the debt ceiling, allowing the Government to reopen again. And record highs after the US House of representatives vote with USD/JPY at 99.00.
With the passing of the trading day, the u.s. currency came under selling pressure accelerated in early London trading after reports that Chinese credit rating agency "dagong has reduced us to A credit rating from A. This action was part of a Chinese campaign to stop us domination of world trade, China is trying to reach the status of reserve currency, this has provided an incentive for milliseconds more altasheel to the US dollar as the euro/US $ 1.3630 level while the British pound has targeted level 1.6100 and approached Australian dollar level was .9600.
There are fears in the market over the long-term impact of the closure of the US Government on the US economy, however, the last assessment of the s & p has stated that America had lost 0.65 US GDP in the fourth quarter because of the tensions in Washington. And at least the crisis closed the Government guarantee that the Fed would maintain the quantitative easing policy this year without change and may maintain this until January 2014 before u.s. monetary policy officials feel comfortable enough to stop economic stimulus.
Likely like this scenario to the US dollar for sale at the moment that the US economic data showed weakness as a result of political mechanisms over the past two weeks. One of the most positive aspects of the US Government shutdown crisis is that this crisis is resolved before the Christmas spending season so this may have the minimum impact on consumer spending in the fourth quarter.
On the other hand, the high rate of consumer spending in Britain to the British pound, with UK retail sales rising by 0.6% versus expectations of a reading of 0.5%. Basic reading recorded retail sales reading that excluding food and energy the results exceeded expectations. Sales are still strong, but foods except the food sector remains weak.
In General, this is the third month of the heights of between four months and this shows that the rate of us consumer demand continues to expand positively albeit moderately. It is expected that the British economic data today contributor in the growth rate of GDP and this is a good supporter of the British pound, though, that the pair continues to face resistance at 1.6100 and greater resistance at 1.6200. And continue to rise against the US dollar during the trading session, it rushes towards the level of Sterling 1.6150 over today.
