HiFX: Foreign Exchange Specialists

• Headlines

June 10, 2008

With markets focused on rhetoric from central bankers and the dichotomy they face with regards to balancing risks to growth versus risks to inflation, Federal Reserve Chairman Ben Bernanke has proven to be a major catalyst in driving price action within the FX markets.  Bernanke’s latest comments highlighted that the Federal Reserve have undertaken sufficient action to stave off risks to economic growth, with focus now firmly on actions needed to contain inflationary pressures.  In this regard the market views the Fed. as hawkish on monetary policy and have begun speculating as to the timing on possible interest rate hikes.  Following Bernanke’s as well as Treasury Secretary Paulson’s comments the USD gained nearly 2% against a trade weighted basket of currencies.