Waiting for the FED, USD edges up from 5 week low

The dollar edged higher on expectations US Federal Reserve (FED) based on better economic data will start tapering monetary easing in September or later in the autumn. Central bank meetings are due in the United States, England and European Central Bank (ECB) later in the week. No big changes are expected, but a FED policy decision pointing towards a termination in bond buying will probably put upward pressure on the interest rates and strengthen the dollar.



The dollar gained both against EURO, 1.3254, and Japanese yen which paid 98,06 yen to a dollar. The DXY-index where dollar is weighed towards a basket of six major currencies was up 0,3 %% from a five week low. Oil prices, and precious metals, gold and silver lost ground on a stronger dollar. The Swedish krone lost one percent on the Minister of Finance’s announcement of weaknesses in the generally perceived strong Scandinavian economy.



The US banking giant JP Morgan Chase which lately has been under regulators sharp scrutiny, settled on a USD 410 million on alleged power market manipulations in California and Midwestern states. The settlement involved that JPM admitted the facts presented by the Federal Energy Regulator without denying or admitting the facts. Banks involvement in the commodity chain by trading metals and at the same time owing warehouses and pipeline/plants have latest this week been under increasing fire from Congress. The disputed practice was initiated in 2003.



Global stock markets have lost some of its momentum starting a new trading week. Both Dow Jones and S&P ended in red following a selloff in telecoms and materials after disappoint quarterly results from Verizon and Mosaic.