US Dollar:

US $ is said to be neutral for the coming week. There is also the possibility that the dollar will go down if the risk appetite of the investors return and there is discussion on deficits. The risk appetite of the people is said to be unknown due to the fact that if with the other markets the currencies market might turn for the better, the government might withdraw support and another bank might fall causing the markets to reverse. Also if the government progresses slowly towards growth and expansion, the other world markets might progress faster than the dollar causing it to devaluate. There are a couple of important speeches made in the coming week that might change the course of the dollar, like the speech of chairman Bernanke on the ongoing financial literacy or lack of it and the Federal reserve’s duke’s answer to the ongoing financial crisis.

EURO:

The forecast for the Euro looks bleak. It is expected to be bearish. This is due to the fact that the fundamentals of the growth of the Euro were not clear. The European economic data also looks uneventful. The levels of volatility in trading looks lower than expected and hence the Euro and Dollar will remain at the level it normally has been at. The Central bank is also not very keen in pursuing monetary stimulus. The Euro CPI data that is expected to be issued in the coming week could also determine the trend and movement of the Euro. All in all the lowering in prices will cause the interest rates to get revised and thus the Euro. The Euro however at the same time could move upward if the S&P index continues to give it good rating. The British pound could also devalue itself due to the CPI data and consumer sentiments.

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