With the CPI data to be released tomorrow, the U.S. Dollar looked to being doing very well in the forex currency trading market all across the board but particularly against the weak Euro. The EUR/USD forex currency trading rate fell to $1.3566 though it has since recovered somewhat to $1.3628 at the moment and the same is true for the Aussie which fell as low as $0.8951 in the AUD/USD forex currency trade rate but has since recovered to $0.90050.

The forex currency trading market has been in turmoil throughout February with regards the Euro which as we have mentioned before is very uncertain due to the lack of support and concrete plans for a bailout for Greece if required. Furthermore rising tensions between Greece and other Euro nations, in particular Germany have aided in further causing uncertainty regarding the Euro in the forex currency trading market.

Oil prices fell below US $77 a barrel today as the rising U.S. Dollar in the forex currency trading market and high inventories once again came into effect.

Gold prices meanwhile also fell as price of the U.S. Dollar rose at the back of strong economic data on Wednesday. Further downward pressure on gold prices came into effect as IMF announced its resolution to sell almost 200 tonnes of gold into the open-market perhaps because of week off-market demand from the various Central Banks of the world. The IMF however made it clear that it means to sell the gold in a phased manner over time. Gold prices later stabilized to about $1,100 an ounce.

The forex currency trading rate for the U.S. Dollar have however now started falling against other currencies after reports released today showed that jobless claims rose above market expectations. The weakening of the U.S. Dollar in the foreign exchange market though not serious was further compounded by a higher than expected PPI.

Analysts now await the CPI report to be released tomorrow to see what the outlook for the economic recovery for the U.S. will be as well as the performance of the U.S. Dollar in the forex currency trading market.

With the recent slew of bad news for the Euro monetary bloc, its a surprise that there has been a let-up in the fall of the Euro despite efforts made by governments, governing bodies and now the G7 to stall its falling forex rate and to instill confidence in traders. The G7 meeting hosted in Canada witnessed European finance ministers assuring their non-European counterparts that they would ensure that Greece follows through with its claim to make drastic cuts in their budget gap.

Forex currency trading analysts meanwhile claimed that the Euro bloc needs to do more than say words and perhaps even form an agreement to provide support for Greece in these troubling times. The host country’s Central Bank (the Bank of Canada) meanwhile has re-asserted its commitment to ensuring low interest rates at a record rate of 0.25% until June as long as the inflation remains within check.

The Aussie meanwhile has made a strong recovery after news this past week that the RBA (Reserve Bank of Australia) would not be raising interest rates. The forex trading rate at the moment stands at 0.86920 (at the moment of writing) for AUD/USD; having risen whilst this post was being written. This rise in the Aussie forex currency trading rate has mostly been a result of an announcement made by an Australian coal and iron-ore mining company Resourcehouse.

The Japanese Yen meanwhile made some significant gains against the U.S. dollar before being brought back under control. Analysts claim that the rise in the forex currency trading rate of the Yen was mainly due to investors buying the Yen as a “safe haven”. A “safe haven” is a forex trading term used to describe a currency or in the case of gold a commodity that is considered to be a safe means of maintaining value whilst other currencies or commodities are in turmoil or falling in value.

The official interest rates in Australia stand at 3.75 but an official at the RBA in December pointed out that it is believed that the effective (or actual) interest rates were higher partially due to mortgage rates being raised faster by Australian banks in general as compared to increases in the Central Bank’s own cash rate.

Despite the immediate fall in the AUS/USD exchange rate, analysts predict that over the course of the year the Aussie will continue appreciating as strong demand from India and China for exports and expected rises in interest rates by the RBA continue to make its effect felt on the Aussie forex rates. And this post also goes to show that forex trading and news go hand in hand.