Will ECB Trichet Recognize the Pain?
• Canadian Dollar Hits 31 Year High, Australian Dollar at 18 Year High US Dollar Beaten to a Pulp; Is Euro 1.50 Next? The US dollar succumbed to heavy selling on the last trading day of the month, which also happens to be the last trading day of the quarter. As the value of the once mighty buck continues to fall, other currencies have hit multi-decade highs. More specifically, the Euro rose to a record high while the Canadian and Australian dollars hit 31 and 18 year highs respectively. Although we saw evidence of improvements in the manufacturing sector today (Chicago PMI and Construction Spending surprised to the upside), there is still plenty of reasons for concern. Personal income growth slowed as spending increased while the PCE deflator moderated. Collectively, this data reinforces the need for the Federal Reserve to lower interest rates at the end of next month. However we do not expect anything more than a quarter point rate cut since the rise in commodity prices and the fall i
