China Continues Tightening, Dollar Rallies

Friday, February 12, 2010

  • Toyko gained 1.3% overnight yet London and US futures are trading lower. Actions from the China government sent the dollar higher against other currencies and likewise spurred selling in various commodities.

  • China is dominating the headlines today as The People's Bank of China raised the reserve requirements for banks 0.5%. This is the second time in a month it tightened in order to curb lending in the country. China is attempting keep its economy from overheating in this global economic rebound.

  • Gross domestic product reports in the Eurozone showed a meek 0.1% growth rate versus the 0.3% expected. Slovakia led the 16-nation group with a 2.0% expansion with France trailing with a 0.8% gain while Greece contracted 0.8% and Germany stalled. The euro made new lows for the year after the data was released hitting $1.353 against the dollar.
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