Fed official: U.S. dollar will remain strong next 10-15 years

Fed official: U.S. dollar will remain strong next 10-15 years
At 00:47 on January 9, 2010 Source: http://www.shiweilai.com shiweilai "While the yuan is being settled through the cross-border trade, currency swap agreements, the issuance of renminbi-denominated funds overseas, such means as strong abroad, but with each days up to 5 trillion global settlement amount of U.S. dollars compared to the world's reserve currency, but a minor; even as the world's two other strong currency, the euro and the yen, but also difficult to transcend and replace the U.S. dollar in the next 10 to 15 years , a relatively strong U.S. dollar remains the world's currency. "January 7, as a branch of the St. Louis branch of the Eighth Federal Reserve Chairman, James Bradley in Shanghai to attend a small-scale speech, after he accepted the Daily News reporter during an interview for the case of the RMB and U.S. dollar trend analysis.

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Economic recovery, the Bank of England to mention the bumpy road out of New Finance Minister took a strong yen will turn around and raise interest rates remain a distant U.S. dollar faces an uncertain future in the yuan and U.S. dollars at the end separated from the second quarter of 2009 the foreign exchange platform for the most popular selection [yuan license] [Quotes Center] When asked about the Fed's monetary policy this year, what changes will occur this year, U.S. dollars, euros, yuan in the end which will be the first interest rate increase and other issues, James Brad chose the ambiguous answer, but this year the United States and global economic development, then the optimistic attitude.

"China Times": the financial crisis made the United States, many financial institutions are facing a hopeless situation, the Federal Reserve to financial institutions through a variety of means blood transfusion, at the same time in order to increase market liquidity, in turn the Federal Reserve lowered interest rates to almost zero, does the Fed's injection is a dollar by printing the way? Now the U.S. economy has been showing signs of recovery, the dollar's low interest rates will come to an end?

Brad James: not so in the comments of the outside world, many people think that the U.S. government will be printed more money, but in fact the Fed is not printing money, we and the Government to do a huge bailout to save paragraph by " E-type "(Electroic Entry) way to do the accounting book on the treatment, without using actual money.

And since the crisis broke out, we have to save the market, resulting in rapid expansion, therefore the balance sheet. But in fact, our bailout money is not mainly from the currency. But from the following three chunks: the first one is the funds raised by selling government bonds, from July 2007 to the end of 2008, our net debt balance of a decrease of more than 3000 billion U.S. dollars; second block of the Ministry of Finance of special deposits, in order to deal with the financial crisis, the U.S. Treasury Department in addition to increasing the general deposits, the central bank has also its opened a new "supplementary financing account" the two types of account balances in the aforesaid period of time a net increase of 400 billion U.S. dollars; third block is through the payment of interest means to attract financial institutions to increase the reserve deposits. The balance over the same period a net increase of 800 billion U.S. dollars. Three are added together, the total cumulative amount of money up to 1 trillion U.S. dollars, for us to save the city provides a very ample "ammunition."

Now, the U.S. economy, whether the real estate market, or the consumer market into the bottom of the second half of last year, after a slow recovery process, the overall U.S. unemployment rate is still high, but its growth has started to slow down, for the United States this year's economic situation, I am very confident. In the economic crisis, we will be the Federal Reserve lowered interest rates to almost zero, this situation should continue for too long, because the U.S. economic recovery, the situation is not very solid, Federal Reserve monetary policy change is to look at the actual situation and whether to adopt the policy interest rate to go through the members of the Committee voted to very carefully.

"China Times": Now, China already has more than 2 trillion U.S. dollars in foreign exchange reserves, now the U.S. dollar is in a weak position, the outside world have predicted U.S. dollars in the next five years, will continue to depreciate this how you see it?

Brad James: Yes, we are also concerned that China's foreign exchange reserves have more than 2 trillion U.S. dollars, of which the main assets, mainly U.S. dollars, this is actually its foreign currency features and the pattern of international financial market decisions. In the global financial markets, the U.S. financial markets with the greatest variety of products, the largest and most liquid, most transparent, so the world's foreign exchange reserves are in U.S. dollars of assets and investments mainly in the U.S. financial markets.

In the global foreign exchange trading, the dollar share of transactions in other currencies as high as 90%. In this environment, the foreign exchange reserves, more countries would want to invest in non-dollar assets, as the main target, it must be because of market size and liquidity of the limitations of greater risk, such as the price of investment products, a result of the proposed small-scale and so on are easy to raise.

I do not think the next five years, the dollar will continue to depreciate, in the world's major economies have increased the money supply were the case, I expect the greatest possibility is that the economic recovery ahead of schedule and long-term inflation risks, rather than the U.S. dollar continued to depreciate. In the short term, we will maintain the relative stability of the dollar in order to attract foreign capital inflow, to help our economy out of the woods. From the long term, the dollar could even turn into a secondary school derogatory to the appreciation of the main cycle.

"China Times": In the last year, the eve of the Group of 20 finance ministers meeting, China's central bank governor Zhou Xiaochuan has issued a document initiative to create a super-sovereign currency to replace the existing U.S. dollar's status as the world's reserve currency, the RMB is now through a variety of to expand influence in the world do you think the U.S. dollar the world's reserve currency will not be another currency substitution?

Brad James: We see that the renminbi is now indeed being through a variety of ways to expand its world impact, but this effect is only confined to East Asia, within the current international monetary situation, the world's three major hard currency, namely U.S. dollars , the euro and the yen, which is not big enough the size of the yen, the euro itself, because there is no an actual individual, so the dollar in the next 10 to 15 years, is still relatively strong global currency. RMB internationalization process will be very long, the dollar's international status is now is not overnight.

The world's currency reserve system will certainly change, but it will be a slow process. The Fed's task is to maintain a low inflation rate and the dollar's strength.

Foreign Exchange Investment Myth: The biggest bright spot in Africa and the United States currency

Foreign Exchange Investment Myth: The biggest bright spot in Africa and the United States currency
At 07:37 on January 4, 2010 Source:
http://www.maozdong.com
maozdong.com Ruo frankly, volatile the market now, it seems difficult to see the future direction of non-US currencies

Ruo (a pseudonym) has been more than two months there is no foreign exchange investment firm offer of. He told reporters on the financial weekly, the current non-US currencies are basically in volatile trading on the firm offer for the operator, the transaction difficult.

Ruo early in Dongguan to do foreign trade, due to frequent and hedging foreign exchange settlement deal was a direct switch to full-time foreign exchange trading, his best record was in 2007 received the Bank of China (601988, stock bar), Guangdong Province, the fifth branch of foreign exchange trading contest name. Other players to operate the Australian dollar and the euro, more profitable, and his little difficult to operate the demon of Japanese Yen.

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Economic recovery, the Bank of England to mention the bumpy road out of New Finance Minister took a strong yen will turn around and raise interest rates remain a distant U.S. dollar faces an uncertain future in the yuan and U.S. dollars at the end separated from the second quarter of 2009 the foreign exchange platform for the most popular selection [yuan license] [Quotes Center], however, he is now the biggest interest is operating virtual disk, the Handicap in Hong Kong open. Ruo said that Hong Kong banks usually provide about 10 times leverage, while the finance company can provide 20 times. "The market is down, you can short the virtual disk is often larger profit than a firm offer." A few days ago, he had just completed a deal to sell the 1.441 euro / dollar, while in 1.436 profits, "net of transaction point of difference, about earning 40 points. "

In the domestic foreign exchange market, a firm offer can only see more than the base currency is usually U.S. dollars, only when the non-dollar currencies against the U.S. dollar rises to make a profit, and overseas both the virtual disk can be seen more, you can also see an empty, if you choose short, even if the non-US currencies against the dollar, but also profitable. In 2007, domestic banks have opened 10 times the virtual disk transactions, but because of high risks, and later stopped by authorities.

The euro gains 13%

Virtual disk earnings are high, but the risks are also great. Ruo said that his choice of 10 times the leverage of the euro / dollar transactions, for example, single-handedly 100,000 euros for every purchase / USD 10 thousand U.S. dollars required margin of 40 points, there are 400 U.S. dollars of profit, with the principal compared to a profit of about 4%. "In principle, the greater the investment in bonds, revenue more." Ruo changed the subject, "but how to control risk, and no one want to play the margin trading investors can not be ignored."

As the foreign exchange market is almost continuous operation 24 hours per week, Monday morning, the Australian market, the first transaction in the evening after the close of the New York market will relay to other markets, so investors often neglect irreparable mistakes. Ruo said first announced a few years ago yuan appreciated sharply against the U.S. dollar, the yen on the international market in 30 seconds against the U.S. dollar jumped more than 100 points, 2 hours rose by 400 points or more. The large number of short yen are too late to stop, and he was in dinner, originally thought to eat hanging in front of the stop-loss orders can reduce these losses, he did not expect, or nearly 50 points more than sacrificed.

However, the key to profitability will still have to determine the general trend. 2009 Ruo do the best wave is from March to June in which wave Quotes.

"I'm early in March in the tentative construction of about 1.27 of a euro / dollar positions, about half of the 1.33 clearance." After the euro / dollar has fallen to 1.29 or so, "I observed a long time, in the euro / dollar re - back to 1.30 to buy. Then, I was in the euro / dollar break through 1.35, when to increase positions, and finally around 1.40 all out. "

"This wave, earn about 7%." Ruo said that about a month later, he was aware of the euro / dollar signs have started, so at around 1.39 euros to regain. All clearance around 1.48 or so, about making a 6%, two amounts are compared to Ruo the euro / dollar on the maximum benefit of about 13%.

"In contrast, if you choose this year's Australian dollars, or even over 40% of revenue. However, there are two very important foreign exchange speculation, one unfamiliar to not do it, the euro the U.S. dollar index, the largest share, if the Do you think the U.S. dollar should be down to buy the euro is the most prudent choice, second is better mentality, fried Exchange who does not want to make money, but the first thought might be losses, to prepare only possible to make money. "

Now moving to look at less

As a professional speculators, Ruo frankly, volatile the market now, it seems difficult to see the future direction of non-US currencies. Therefore, he only Duanchao, when the feeling of a short-term decline in the currency against the U.S. dollar too much, he would do more appropriate, and when one currency against the U.S. dollar rally a few days later, he was an appropriate short.

"The euro against the dollar has fallen almost 800 points in the short term does not seem to do the kinetic energy of the empty strong, other non-US currencies or less the same Australian dollar fell more than 500 points, the Swiss franc dropped by more than 400 points, the pound fell 900 points, yen also dropped by more than 400 points. "Ruo said that if investors want to capture a large market, should no longer wait.

Expert opinion

The euro also loosened the opportunity to

Non-US currencies from the current depressed situation of view, numerous investors bought the euro does not seem a good mood in the New Year. However, Tai Fook Securities in Hong Kong Foreign Exchange and Gold Anthony Wong, research director of the financial weekly newspaper reporter that the recent EUR / USD have the opportunity to rebound to 1.46, GBP / USD have the opportunity to rebound to 1.67, while the time for this opportunity is expected to appear next year in January mid.

Anthony Wong, said the U.S. dollar against the strong non-US currency in recent years and banks and institutions related to the year-end. In general, the last month of the year is almost always stronger U.S. dollar. Many of America's multinational companies need to return from abroad and turned into U.S. dollars remitted back off, the sale of bulk commodities and other transactions of the investors have profit-taking requirements. When most investors choose in U.S. dollars, the dollar exchange rate will inevitably be strong.

However, after the year-end, the dollar will re-return of the international market, the dollar turn soft. More importantly, the decision of the ultimate strength of the U.S. dollar interest rates are not likely to occur early next year, possibly as early as next year appear, therefore, the dollar should be the real strength is expected as early as 6 months later.

So, expect euro / dollar short-term correction in the vicinity of 1.42-1.43, early next year could fall to 1.42, while in January have the opportunity to rebound to 1.46. In the first half of next year also have the opportunity to reach more than 1.50, but in the second half probably will drop to 1.40.

GBP / USD trend weaker than the euro, have the opportunity to see 1.67 in the first half, but at least the second half is expected to fall to 1.53-1.55. Yen / dollar Worse, in January have the opportunity to see 93-94, in the second half and even below the 100 mark.