Fall in USD Rates Linked with Negative Reports on US Construction Sector: Expert of ATON
Azerbaijan, Baku / Trend / A fall in the US dollar rate with respet to almost all world curencies is linked with a negative view on the US construction sector, according to Vladimir Osakovskiy, an economist of the Analytical Department of the investment company ATON.
Particularly, leading construction companies and suppliers of construction materials in the United States have recently publicized forecasts that predict a crucial drop in their profits by the end of the year, indicating a decrease in the construction sector as the major contributing factor.
"This situation confirmed the earlier threats in the market on the continuation and even deepening of a drop in this sector. It will have a negative impact on the US economy in general," Osakovskiy added.
At present, the correlation between the European and US currencies is €1 to $1.3756, whereas rate fixed during the morning session on the previous day was €1 to $1.3612.
As a result, the market is sure that the United States will not increase its rates this year, but to the contrary, cut them to stimulate the development of economy.
"This is the main reason for a drop in rates of the US Federal Reserve System, because prospect for lower rates reduces its attractiveness with respect to other currencies. Even some weeks ago, the expectations at the market were contradictory, which led to drop in rates of the dollar and euro during May and June," Osakovskiy noted.
The Euro reached a higher point at a trading session at the Asian electronic platform EBS - $1.3787 to the Euro.