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Dollar’s Giving Up on Poor Fundamentals

September 25, 2008 by

Weak fundamentals will probably make Fed to cut the interest rate one more time by the end of the year. At least the dollar’s bearish movement on Forex today indicate that. EUR/USD reached its peak above the yesterday’s high and posted the first positive result in three days. It now trades near 1.4715 level.

Durable goods orders unexpectedly decreased by 4.5% in August, following 0.8% increase in July (revised down from 1.3% growth). That was a major negative fundamental surprise for the dollar, as the analysts expected only 1.3% decline.

Initial jobless claims reached 493,000 last week — that’s almost half a million, or 32,000 increase compared to a previous week. A decline to 450,000 claims was expected today.

New home sales in the month of August declined to 460,000 seasonally adjusted annual rate, down from 520,000 in July (revised up from 515,000). New home sales were expected to grow to 518,000 in August.

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