*Last Updated August 28, 2006, 11:38 pm

Daily report by CMC Markets

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FOREX ANALYSIS

Dollar remains exposed ahead of Fed minutes; choppy outlook for week ahead

August 29th - With not too much of note on the economic calendars today, attention is most likely to focus on the release of the FOMC meeting minutes from earlier in the month. Traders remain keen to try and establish whether or not a return to the hawkish stance over interest rates is likely to be seen but after Ben Bernanke avoided the issue at last week’s summit, many are building a consensus that the next move may eventually be lower. Two other notable events ahead of this – the release of US consumer confidence figures for August and as speech by the President of the Dallas Fed which is likely to be followed by a question-and-answer session – obviously could offer the dollar some support after yesterday’s downbeat start to the week but right now the prevailing mood against the greenback is certainly looking to be a bearish one. As the week progresses the data flow will however also pick up, culminating in the non-farm payroll figures on Friday and as we’ve seen before, there is a very real chance that moves off the back of the Fed announcements at the start of the week could be reversed if the data provide a conflicting outlook in due course. As a result there’s no shortage of directional information over the next few days but quite how the dollar will finish the week remains to be seen.

Stuart Scrase



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