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 Forex Analysis
28

Forex Playbook: March 28-03


Overview

Despite new highs on the Dow and S&P 500, risk aversion dominated the Forex marketplace last week. The US dollar pushed ever higher against its major counterparts, as growing concerns over the Greek debt crisis and a credit downgrade for Portugal weighed on investors. In the current quarter, the euro has slipped 6.8 percent against the dollar – the largest quarterly decline since 2008 – reflecting a general preference in the marketplace for the perceived safety of US assets.

In the week ahead, expect growing volatility for riskier assets, as the results of a $6.7 billion bond offering out of Greece is certain to move markets. The euro and sterling are particularly vulnerable to further declines, as a lack of confidence and the force of trends continue to work in their disfavor.

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