Wednesday, November 08, 2006

Dollar Consolidates !!

The dollar is trading in a narrow range between 1.2750- 1.28 after the Democrats took control of the U.S. House of Representatives and the battle for the Senate still hangs in the balance. As we said before, the impact of election is limited as the fiscal policy is not likely to change in near term. The market focus shifted back to fundamentals and central bank¡¯s rates outlook.

The euro was little changed after a report showed Germany¡¯s current account surplus in September widened to 9.4 billion euros from 2.4 billion in the previous month.

Besides, Bank of England is expected to raise rates from 4.75% to 5.00% on its policy meetings Thursday.


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