Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: Pogeu Mahone who wrote (244437)	6/8/2003 11:16:27 AM
From: Haim R. Branisteanu	Read Replies (1) \| Respond to of 436258

They guy does not know what he is talking about. Conversion cost from USD to EUR or reverse are 0.04%. Selling oil futures and buying EUR as a hedge gives them an actual 10% return for the oil not paid if they really want to hedge. As to the direction of the USD v. EUR - banks are clue less as usual making predictions based on their holdings. Bets Pared U.S. Treasury notes fell yesterday as traders reduced expectations Fed policy makers will cut their 1.25 percent target rate by a half-point at a meeting on June 24-25. Speculation the Fed would cut by a half-point mounted after the European Central Bank reduced its benchmark rate by that amount, to 2 percent, on Thursday. Traders are still betting the Fed will lower the benchmark rate by a quarter-point later this month, based on the 1.00 percent closing yield on the July fed funds futures contract. ``The message about the economy is we're on the turn,'' said Ram Bhagavatula, New York-based chief economist for North America at Royal Bank of Scotland, the 12th-biggest trader in the $1.2 trillion-a-day foreign exchange market, according to Euromoney magazine. A 20 percent decline in the past 12 months against the euro means ``the dollar's oversold,'' he said. The dollar gained against 14 of the 16 most frequently traded currencies yesterday as analysts including Bhagavatula said U.S. growth will likely outpace the expansion in the euro region, where the central bank cut interest rates yesterday. U.S. Growth Bhagavatula forecasts the U.S. economy will grow at a 4.1 percent clip in the second half of the year while the euro region will probably expand less than 2 percent. The dollar will rebound to $1.10-$1.12 per euro within six months, he said. ``A lot of people were looking for a bigger down number on jobs,'' said Michael Rosenberg, New York-based global head of foreign exchange research for Deutsche Bank AG, the third-biggest currency trader. ``People are maybe saying the economy may not be as weak as they were expecting. The knee-jerk reaction is to buy the dollar.'' Some analysts say the dollar will resume its slide. Goldman, Sachs & Co., the No. 5 currency trader, this week raised its forecast for the euro against the dollar and yen. The securities firm said it expects the euro to reach $1.24 in six months, compared with a previous forecast of $1.15. Goldman forecasts the euro will rise to 142.6 yen in six months, compared with a prior forecast of 132.3 yen. The euro traded at 138.80 yen yesterday. ``We're not out of the woods yet,'' said Don Alexander, a currency strategist at Citigroup Private Bank, with $166 billion in assets. ``I still look for further dollar weakness,'' with a decline to $1.20-$1.22 possible in the next few weeks, he said. In a sign of foreign central bank buying of Treasuries, those banks' holdings of Treasury and agency securities in accounts at the Fed rose by a daily average of $5.6 billion in the week through Wednesday to $933.4 billion. Japan's government sold a record amount of yen in May, dumping the equivalent of $33.5 billion, the Bank of Japan said last week. quote.bloomberg.com