Guess what folks? China still thinks the US is safe to invest in. Yes. I know. Weird, right? It wasn’t so long ago (think, weeks) that China was talking about the US treasuries dropping in value, what with the dollar flood that Bernanke and the Fed unleashed on us. In fact, China still seems to maintain that position, at least as far as their comments go. However, there’s data out there today that shows that China took on more of these treasuries in February, just a short time before those comments. Everything isn’t as black and white as it seems. The US still remains a haven. That won’t change quickly.
That information should bode well for the dollar in the long run. Short term, well it had a mixed day today in Forex trading. You can see on the Forex Chart above, it’s gaining against the Euro, but not against the Pound. Some numbers out today weren’t too good for US, but others weren’t so bad. It’s still a mixed bag out there.
The Pound seems to have a lot of momentum right now. It will probably continue to strengthen. It lost way too much during this whole crisis, so this correction is expected. The Euro on other hand has not shown much spirit. We could be heading down.