Greenback falls ahead of home sales figures

07-26-2009 13:12

The Greenback continued to decline versus currencies such as the Euro today, ahead of the US home sales report, which will probably prove that home sales increased considerably, indicating that the worldwide recession is bottoming, resulting in a rising demand for high-yield investments in equities. This week could be the third week of losses for the US Dollar, caused by various factors such as fears concerning the position of the US Dollar as the most important reserve currency and due to optimism in Asian equity markets. Today’s report is expected to show a significant increase in US month-to-month home sales, which could boost the demand for riskier assets, as a progressed situation of the housing market is a firm evidence that the slump in the US is facing its final days and therefore in a worldwide perspective. At the start of this week the US Dollar prospects are quite negative due to rumors that foreign-exchange instability will diminish and as a result of doubts regarding the status of the US Dollar as the main global reserve currency. Surely the US Dollar will decrease even more, though it remains insecure if the Greenback will fall against the Single Currency to last year’s level of $1.60.