Treasury - Daily Forex for day 14.12.2004

...for Q3 due on Thursday is expected to show the deficit of $170 billion, up from $166.2 billion in Q2. Moreover, Tuesday's data on the U.S. international trade is expected to show a shortfall of $53.0 billion in October, widening from September's $51.56 billion. By contrast, the Federal Reserve is widely expected to raise interest rates for a fifth time this year on Tuesday. The key fed fund rate would therefore be lifted to 2.25%, above the euro zone's 2% level for the first time in over three years. Earlier on Monday, the dollar got a short-term support from higher-than-expected U.S. retail sales figure for November.

The Czech crown surged to a new two-year peak of around 30.500 to the euro yesterday after news that Central European Media Enterprises agreed to buy TV Nova for $642 million. Earlier in the day, the balance of payments figures for October showed a smaller-than-expected 12.9 billion crown gap, providing an impulse for the crown's firming. This morning, the currency shrugged off a report showing industrial producer prices were steady in November from October, while the market had forecast a 0.1% monthly rise in PPI.