Forex Trading Forecast: U.S. Dollar

Greenback in currency trading

Things have been volatile for the U.S. dollar recently, with rallies coming and going. And this time period is no exception. The forex trading forecast for the U.S. dollar continues to be somewhat obscured as investors consider the merits of different points of view.

For now, the U.S. dollar is slightly up against the euro in forex trading, but down against the yen on risk aversion and down against the sterling as data in the U.K. improves. But how long will this last?

GFT’s Kathy Lien looks at the issues related to the forex trading forecast for the U.S. dollar in FX360:

The central issue is that investors do not believe the U.S. recovery is over. Yes, job losses accelerated last month, but the labor market is still improving. As long as the U.S. economy is moving in the right direction, their belief is that investors should grow more confident in dollar denominated investments. Yet comments from Fed officials indicate that interest rates won’t be increased anytime soon and China’s latest trade numbers illustrate how the U.S. economy is lagging behind its greatest competitors.