Tuesday, January 5, 2010

Strategist: Dollar Rally Is Coming to End

Michael Woolfolk, senior currency strategist at Bank of New York Mellon, says the dollar’s recent rebound will peter out early this year.

The greenback dropped to a 14-month low in November, but has since bounced back amid signs of economic recovery in the United States and anticipation of an interest rate hike by the Federal Reserve.

Woolfolk told Bloomberg the dollar may rise for another couple weeks, thanks to seasonal factors.

Then comes the decline

“The bad news is that until the Fed begins its process of normalizing interest rates, there are just too many factors weighing against the dollar for it to have any hope of a cyclical rebound.” (more)

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