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Great New Year for Dollar as All Fundamentals Look Positive

January 5, 2011 by

The beginning of the new year looks good for the dollar as virtually all reports from the US so far showed positive results and today’s reports weren’t different. The reports showed that employment improved and services industries expanded in the US. As a result, EUR/USD dropped heavily from the opening rate of 1.3307 and trades currently near 1.3144.

ADP employment change report showed an increase by 297k in December from November increase of 92k (revised from 93k). The expected change was growth by 101k.

Crude oil inventories decreased by 4.2 million barrels and total motor gasoline inventories increased by 3.3 million barrels last week. Both are above the upper limit of the average range for this time of year.

ISM services index rose from 55.0% in November to 57.1% in December. Estimates of analysts promised a much smaller growth to 55.6%.

Yesterday, a report on factory orders was released, showing an increase by 0.7% in November, following the 0.7% decline in the previous month. A decrease by 0.1% was expected.

If you have any comments on the recent EUR/USD action, please, reply using the form below.

2 Responses to “Great New Year for Dollar as All Fundamentals Look Positive”

  1. Joanne

    Looks good but then again the data was for December so the positive numbers could have been due to the holidays.

    Reply

    admin Reply:

    Actually, ADP employment, ISM services index and factory orders data is all seasonally-adjusted. So, even if it’s Christmas – it means that this Christmas was much better than previous Christmas for the US economy.

    Reply

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