The dollar was stronger during the European trading session as Fed Chairman Ben Bernanke reassured investors over inflation concerns while Moody's downgraded the government bond rating of Hungary.
Overall dollar strength was apparent in the forex market today as the dollar recovers from last week's losses due to weak employment numbers . At lunchtime during European trading the EUR/USD was trading lower at 1.3300, from an opening day price of 1.3413. The GBP/USD was down at 1.5675, after opening the day at 1.5773. The USD/CHF was up at 0.9850, following an opening day price of 0.9736.
Commodities were little changed with spot crude oil trading at a 22-month high.
In an interview during the weekend Ben Bernanke suggested the risk for a double dip recession in the US economy was unlikely while stressing investors had placed too much emphasis on higher future inflation.
The focus was shifted back to Europe as the government bond rating of Hungary was downgraded by Moody's Investor Services. The rating was cut to Baa3, only two slots above junk status. The downgrade may highlight just how central Europe's fiscal issues are shifting to the outlier nations Europe.
Major Canadian economic data will be released this afternoon with monthly building permits due at 13:30 GMT followed by the Ivey PMI at 15:00. Negative results for both may boost the greenback versus the Canadian Dollar. Last week the USD/CAD failed for the fourth time to close below the key 0.9980 level. Traders may want to be long on the pair with resistance at Friday's high of 1.0080, followed by 1.0140.
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