The U.S. Dollar gained against the Euro today as crude oil prices fell, again. However, following a rally which was ignited by the bailout of the two giant mortgage firms, Freddie Mac and Fannie Mae, the broader gains were reduced by mild profit-taking. In early morning trading in New York, the Euro dropped and traded at 0.3% at $1.4086.
Regarding the ICE Futures, the U.S. Dollar increased slightly by 0.1% to 79.652 DXY. This Index measures the U.S. Dollar value versus a basket of other major currencies. The Pound Sterling remained almost unchanged at $1.7572, following a report that British manufacturing output dropped in July, the fifth straight month.
The global economic slowdown appears to be helping the U.S. Dollar, and most analysts believe that the American economy will recover faster that the rest. However, still according to analysts, while the markets are positive about the bailout of the mortgage giants, they do not believe that the U.S. Dollar will continue to rise rapidly against major currencies.
Oil prices dropped to a new 5-month low because investors believe that OPEC ministers will leave output targets unchanged. The price of other raw materials also dropped; lower commodity prices usually bolster the U.S. Dollar. The U.S. crude oil “CLc1” dropped by $1.80 to $104.51 per barrel.