Yen Falls Against the Euro
A second straight day of losses forced the yen down again today as the U.S. government is set to inject a further $250 billion into financial institutions. This is likely to increase interest in carry trades resulting in selling yen in favor of higher yielding currencies such as the Australian dollar.
President Bush Instructs Treasury to Begin Buying Bank Shares
Arguing that the latest move to prop up U.S.-based commercial banks is “not intended to take over the free market but to preserve it”, President Bush instructs the Treasury to begin the acquisition of shares in the troubled institutions. Nine banks will participate initially in the scheme that calls for the banks to buy back the shares once the markets stabilize.
Crude Prices Fall on Fears that U.S. Economy is in Recession
Crude oil futures shrugged off any optimism generated by recent market interventions on the part of the government falling just over half a percent on Tuesday. This combined with an expected increase in oil and gasoline supplies has many investors feeling that supply continues to outstrip demand.
Crude Futures Fall Under the $80 a Barrel Barrier
After slightly rebounding this morning, the Canadian dollar reverted to a weaker position as crude oil futures dropped under the $80 barrel barrier earlier today. The loonie has fallen more than thirteen percent since mid-summer when oil was nearly $150 a barrel.
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