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Mix-Ansicht- Rohstoffmärkte und Starker Dollar ein engl. KommentAR - yatri, 05.07.2001, 19:20
Rohstoffmärkte und Starker Dollar ein engl. KommentAR
There was an interesting article I read this week regarding the Federal Reserve, interest rates, the US dollar and the economy. The article was written by a 'Fed watcher. ' Such a person is nothing more than an analyst that keeps a close eye on the Federal Reserve with the hopes of uncovering a policy change before it becomes common knowledge.
Obviously, a great deal of money can be made or saved if one can truly reveal what the Fed wishes to do ahead of time. After all, the Fed usually gets what it wants. That is no great secret. That is why there are Fed watchers!The article claimed in the most recent Fed meeting, comments were made concerning unusual developments keeping the US economy from recovering as fast as hoped for. Those unusual developments appear to be offsetting the lower interest rate policy the Fed has embarked upon over the past 9 months.
Understand, that the Fed has been lowering interest rates faster than at any other time in history. Yet, the economy shows few outward signs that it is improving. Historically, that is rare since lower rates always spark renewed economic growth. But not this go around.
For example, in the week just ending, both major commodity indices, the CRB(ag markets) and the Goldman Sachs(non-ag markets) closed at a 21/2 year low low. In addition, US and Japanese equity markets closed poorly with each not far the levels of the first quarter which were also 2 year lows.
In other words, over the past 9 months, most hard asset and paper(stocks) asset markets continue to struggle and show few signs of recovery even though the Fed has aggressively lowered rates. It does indeed seem that, 'unusual developments' have offset the Feds easier monetary policy.
Now comes the interesting part! According to that, 'Fed watcher' those 'unusual developments' offsetting the bullish impact of lower rates is the continued and stubbornly strong US dollar. The 'Fed watcher' claims Fed members are none too happy about the perpetual strength being seen with the US dollar. They are not happy at all.
The US dollar has actually been in a pronounced up-trend since 1996, and a few days ago, hit a 16 YEAR high. Historically, when the Fed lowers rates the dollar moves lower as well. That did not happen this go around. This time around, the dollar rose like a rocket as the Fed aggressively lowered rates.
I have argued for 6 months or longer that grain prices remain incredibly depressed to a large extent because of the dollar. I have stated numerous times that it is not a coincidence that corn prices are at a 15 year low, wheat prices at a 24 year low, soybean prices at a 29 year low and cotton prices at levels last seen 16 years ago, while the dollar is at its loftiest levels in 16 years! It is not a coincidence at all!
The 'Fed watcher' claims some Fed members are convinced the super strong dollar is offsetting the benefits of lower interest rates. The strong dollar they feel, is hurting exporters of all kinds thus, keeping the economy from recovering as fast as it should. That is powerful stuff!
Now comes another interesting part! If the Fed usually gets what it wants and they usually do, the odds have increased considerably that the mighty US dollar is about to establish an important peak in value. Assuming of course, it has not already done so.
In the week coming up, the Federal Reserve will meet once more to determine monetary policy. They should lower rates once more, possibly as much as 1/2 point. The lower rates in theory should put pressure the US dollar.Is a strong dollar finally to much of a good thing? Will the dollar finally run out of steam and head lower?
Only time will tell.There is a perfect inverse relationship between the US dollar and hard asset markets. A shift back in favor of hard assets could be at hand. If so, it will be the doing of the Fed with their new opinion about the impact a super strong dollar is having on a weak economy.
Quelle: Commodity Insight auf: http://www.fyii.net/gspeak.htm
grĂĽĂźe
yatri
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