Dollar to strengthen in 2007 as US economy recovers - American Express Bank

BY

The dollar should strengthen in 2007 as the US economy shows signs of picking up after another quarter or two of economic slowdown, according to American Express Bank.

In its global outlook report for next year, it forecasts that US growth will slow to a "still respectable" 2.6 pct in 2007 from 3.3 pct in 2006.

Contrary to market expectations of a rate cut by the Federal Reserve by mid-2007, American Express expects the Fed to remain on hold, which will help the dollar higher against the euro and the pound.

"Markets look too pessimistic on the US outlook and are underestimating the extent to which the Fed will tolerate sub-trend GDP growth and weak data in order to ensure that core inflation falls back," said John Calverley, chief economist at American Express Bank.

"Although housing will remain a drag, buoyant wages and strong business investment should limit the overall impact on the economy."

In Europe and Japan economic growth is expected to be near the trend rates of 2 pct, according the report. The European Central Bank is forecast to keep interest rates in the 3.5 pct to 4.0 pct range, while the Bank of Japan will continue to lift rates slowly towards 1.0 pct, American Express said.

Its forecasts concluded that the combined economic trends will help the dollar rise against the euro and the pound but remain steady against the yen, at around 118.0. The euro is expected to fall to 1.22 usd by the end of 2007 from around 1.31 usd now, while the pound is forecast to drop to 1.79 usd from around 1.95 currently.

魯賓

金价又有難

meson

看完了，心有點冷，如歐元能回到1.22或鎊見1.79，我看是否A.E.受美國政府所迫寫這些分析

BY

meson  在 2006-12-19 01:14 發表:

看完了，心有點冷，如歐元能回到1.22或鎊見1.79，我看是否A.E.受美國政府所迫寫這些分析

AE 的分析通常很客觀的，也不是言之無理。

BY

meson  在 2006-12-19 01:14 發表:

看完了，心有點冷，如歐元能回到1.22或鎊見1.79，我看是否A.E.受美國政府所迫寫這些分析

為何心有點冷？只要不盲目做多便不必担心了。

kwy

Thanks BY!!!

birdcalvin

謝BY 兄!!

迷茫之鍊金術士

BY  在 2006-12-19 12:09 AM 發表:

The dollar should strengthen in 2007 as the US economy shows signs of picking up after another quarter or two of economic slowdown, according to American Express Bank.

In its global outlook repo ...

makes sense gei.. all currencies should have reached their record peak and starts falling :P:P