A 1 tenth downtick in the Australian unemployment rate to 5.7 percent flashed a signal of global recovery, tripping a rush out of the U.S. dollar and into commodities including gold. Talk is heavy that interest rate differentials will more than ever favor Asian currencies and the euro as economies in the regions strengthen and interest rates begin to rise. The U.S. economy, where the unemployment rate is 9.8 percent and climbing, appears to be lagging though today's economic news was positive, headed by a significant decline in jobless claims and a run of positive chain-store reports that suggest the consumer, despite the weak labor market, may be showing some life.
The dollar index fell a very steep 0.7 percent to 75.97 for a new 12-month low. A weak dollar points to price inflation making gold once again a center of attention. Gold peaked at a new high at $1,061 before edging back in afternoon trade to $1,056. Equities rose on the day, up 0.8 percent on the S&P to 1,065, helped in part by the strong economic news and by yesterday's strong earnings from aluminum producer Alcoa.
No comments:
Post a Comment