On the eve of the US Presidential Election, currency markets were on pace as traders and market participants await the country’s pick for a new administration.  The idea led some to further unload dollar spot positions, helping the euro gain the most against the greenback since the inception of the single currency.   Greenback weakness was additionally seen against emerging market currencies as both the South African rand and Korean won made gains on the day.  Compared to yesterday’s 1.2643 close, the Euro gained to a session high of 1.3051 against the dollar before retracing at the New York cutoff.  Further easing in the money markets is also seen as improving the landscape for major currencies trading against the US dollar.  Money market rates in most economies have been on the decline, especially US dollar LIBOR.  Declining for the last two weeks, the overnight lending rate now resides 2 whole percentage points lower at 0.18 percent.

Helping along the dollar bears was a report this morning that showed US factory orders sliding in the month of September.  Expected to decline by 0.8 percent, orders for the month plunged by 2.5 percent and followed a 4 percent drop in the previous month according to the Commerce Department.  Although somewhat expected, the figures continue to support a pessimistic barrage of data as the world’s largest economy continues to deal with a recession.

Tags: Euro, US Dollar, US Election

This entry was posted on Tuesday, November 4th, 2008 at 6:00 pm and is filed under Currency Trading, Euro. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.