17 October 2001, 12:23  Forex - Dollar up in early trade ahead of corporate results, Greenspan speech

LONDON (AFX) - The dollar was up against major currencies in early trade, ahead of a batch of corporate results and the US Federal Reserve Chairman's testimony before the joint economic committee, dealers said. Nick Mirtchev economist at HBOS said that since currencies were directed by equity market performance, reports from Citigroup, JP Morgan, Merrill Lynch, Ford, AOL, Time Warner, Coca Cola and Apple could be market-moving events. "The content of the announcements, particularly if scary, in the traditional stock sector which has held up reasonably well recently, has the potential to take the market down," he said. Separately, Richard Grace, at WestLB said the likelihood of the US dollar falling following Greenspan's comments will depend on how frank and cautious he is about the US economy. "Greenspan is not likely to downplay the risks to the US economy. There would appear more risk of the dollar falling, than rising following his speech," he predicted. Meanwhile, the euro was back to the low 0.90 usd level after a moderate rebound yesterday in thin trade. "Without the health scares globally and the continued air strikes in Afghanistan the currency market doesn't really know which way to go," said Mirtchev. "It is proving somewhat unsensitive to various pieces of economic data as well. I am not seeing much of a departure from this pattern of trading," he added. In economic news, today will see the Euro zone's CPI figures for September as well as the industrial production results for August, due at 11.00 am. WestLB analysts believe the euro could see a rebound following Greenspan's speech. In the UK, attention will be tuned to the minutes of the Monetary Policy Committee meeting held on 5 October and the minutes of the Special meeting held on 18 September, at 9.30 am today. Both are likely to shed some light on the possibility of further rate cuts. "If the data comes in particularly weak, then it may have a negative impact on the sterling/US dollar pair," Mirtchev said.

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