The greenback is still holding its recent gains across the broad with no major change in spite of today's surge of oil prices. The data from US have improved recently and currently the speculations for a rate hike have increased especially by the recent release of the Fed's Minutes of 5 August meeting. We are just waiting for the fed to mention in its next meeting that the current interest rate levels are accommodative to start pricing on coming hikes but until now it has not got the interest rate cut out of its table yet as the minutes have shown too.Yesterday, we have seen that US July durable goods have increased by 1.3% from .8% in June and the core figure was expected to increase by .1% but it has come at .7%

The single currency suffering has exacerbated this weak by a surprising slump of the germane IFO business climate index which reached 94.8 in August from 97.5 in July. Also Last week release of  EU August manufacturing PMI has come in the same direction lower than 50 level in the contracting territory at 47 and the EU services PMI flash release has come at 48.2 showing increased worries about the growth outlook in the Eurozone which might shrink this year. The market sentiment is still also negatively impacted by these weak data from EU and geopolitical concerns which can increase in the euro area after the recent confession of Abkhazia and southern Austia by Russia. The tension between Russia and the NATO can increase in the future. The single currency could not find strong footing yet. Technically closing lower than 1.481 is a dovish sign and recording a new low this week after the weak IFO release we have mentioned earlier which can put further weights on the pair which is stepping on 1.465 right now.

Best wishes

FX Consultant

Walid Salah El Din

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