Forex news: Washington rescued Wall Street
Thursday, 17 July 2008
Operators of the currency market could legitimately expect a drop of the dollar against the main currencies today but it was not counting the activism of U.S. authorities. Indeed, the Bush administration was facing this weekend in an avalanche of bad news about the health of the U.S. economy. In addition to the bankruptcy of one of the largest banks in California, the U.S. Treasury had to reassure Wall Street after the last two U.S. groups, Freddie Mac and Fannie Mae, was considerably chahuté Friday in New York. Having received a drop of more than 85% of the value of their shares since the beginning of the crisis subprimes a year ago, the two groups have suffered at the end of last week a sling investors who speculation on the future of both companies. Since the acquisition of the business bank Bear Stearns under the aegis of the Federal Reserve, the Bush administration has demonstrated its intention to markets not drop bankrupt one of the pillars of American economic system. Thus, the Treasury Secretary, Henry Paulson, announced yesterday its intention to temporarily increase the credit line allocated to two groups of mortgage refinancing and he also mentioned the possibility of the acquisition by the federal government 's shares of both companies. Having managed to reassure investors by such a salutary voluntarism, the dollar appears on the rise this morning in front of the single European currency and the yen. However, this week is very sensitive to the dollar with the impact of Henry Paulson speech and publication of results this weekend of major U.S. banks. Hence, the triumphalism is not yet for now although the case Freddie Mac and Fannie Mae seems to be on track.
Labels: forex
posted by Master @ 03:03,