Yesterday was an up and down day for the dollar as global and local fears battled for supremacy. In the early part of the trading session trepidation over the emerging global slowdown held sway with dollar strengthening on its major crosses. Falls in commodity prices have also strengthened the dollar as their suitability as inflation hedges falter; Brent crude dipped below the $100 per barrel level for the first time in 5 months yesterday. This was short lived however as the President of OPEC signalled that he would ask members for a cut in production.

 The dollar was hit in late trading however as news filtered through that Lehman Brothers, the 4th largest Wall St firm by market cap, was struggling to raise much needed cash and that a US government backed rescue plan could be in the offing. The company had been speaking to a Korean bank about a possible investment in recent weeks; talks are said to have broken down and as such left Lehman in a bit of a pickle. The company has brought forward the publication of its latest earnings figures to today (12.30 BST).

It is a fairly quiet day on the data front and as such we will be looking towards stock, credit and commodity markets for guidance and bias.

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 Please feel free to contact me (jeremy.cook@worldfirst.com) if you have any questions or thoughts regarding these updates or if you are interested in a particular event in the calendar. If you would like to discuss your foreign exchange requirements, please contact our:Corporate Foreign Exchange Team on 020 7801 9050 or our Private Client Currency Exchange Team on 020 7801 9080.   

Disclaimer: The above comments are only our views and should not be construed as advice. You should act using your own information and judgement. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgement as of the date of the briefing and are subject to change without notice.Any rates given are “interbank” i.e. for amounts of £5million and thus are not indicative of rates offered by World First for smaller amounts. E&OE. Definitions of jargon/market terms can be found in our Glossary of Foreign Exchange Terms.

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