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Strategies & Market Trends : LastShadow's Position Trading -- Ignore unavailable to you. Want to Upgrade?

To: jtech who wrote (42667)	1/8/2003 12:30:42 PM
From: jtech	Read Replies (1) \| Respond to of 43080

DJ Dlr Falls Hard -2: Report May Have Been Excuse To Sell By Tyler Lifton and John Parry Of DOW JONES NEWSWIRES NEW YORK (New York)--The dollar fell sharply against its major rivals midday in New York Wednesday, bruised by word of an influential bond investor calling for a weaker dollar to fight deflation. Bill Gross, managing director at Pacific Investment Management Co., argued in his January outlook piece that a lower dollar would be a boon for numerous economic problems. Those problems included negligible growth in Europe and Japan, as well as the excessive current account deficit currently run by the U.S., Gross said. Newport Beach, Calif.-based PIMCO is the world's largest bond fund. Reports authored by Gross in the past have be known to prompt a reaction in bond prices. A news report highlighting Gross' opinion was published "right at the time when the dollar really started to get hit," said Robert Sinche, head of global currency strategy at Citibank in New York. "That clearly appears to be what's driving it." The dollar's tumble caught many traders by surprise, following a relatively sanguine morning in foreign exchange. Despite the alacrity of the dollar's broad fall, several New York currency traders and strategists, while acknowledging that the PIMCO report acted as one catalyst, also said the report was as much an excuse as a reason to sell dollars. They emphasized that to a considerable extent the move was based on stop loss positions being rapidly shattered, paving the way for swifter moves. "You have to be a little cautious on this move because it doesn't really have fundamental backing," said Rebecca Patterson, global currency strategist with JP Morgan in New York. The break of a stop loss area at around $1.4040 of the dollar against the Swiss franc triggered a broader dollar dive and really "got the ball rolling," Patterson added. About midday Wednesday, the dollar was trading at Y119.25, plumbing new global session lows and down more than a full yen on the session from Y120.45 late Tuesday in New York The euro was trading at $1.0455, a new global session high and up from $1.0413 late Tuesday. Against the Swiss franc, the dollar was at CHF1.3924, down from CHF1.4001 late Tuesday, while sterling was trading at $1.6099, markedly up from $1.6039. -By Tyler Lifton and John Parry; Dow Jones Newswires john.parry@dowjones.com; 201-938-2096 tyler.lifton@dowjones.com; 201-938-2248 (END) Dow Jones Newswires