NEWS / Foreign Exchange

Fed rate cut is necessary to stimulate the economy

It is startthe economic week with the data for US Consumer Confidence and Existing HomeSales. The traders will focus over the new fundamental reports and willspeculate with the expecting rate cut in US and the slow down of the biggesteconomy.
Thespeculations are widely that Fed will try to stimulate the economy making atleast one rate cut this year. The dollar losses on the market were affect bythe fast rate hike starting from 1.00% to 5.25%. If the Fed keeps the interestrates unchanged during 2007 this will have also negative effect over the dollarbecause the US economy will slow down much more.