News on the Fed rate outlook, the US economy, and a strengthening dollar

Now I don't generally post much actual news on this blog, since as I explained in a previous diatribe I can't usually be bothered to trade directly on economic news -- rather, I focus on what, if anything, various technical indicators tell me the impact of the news has been.

But today this interesting Reuters article caught my eye. It's entitled "Dollar keeps gains as U.S. rate outlook reassessed" and it discusses how optimism about the US economy on the part of Ben Bernanke, US Federal Reserve Chairman and Greenspan successor, has led to a resurgence in the value of the dollar. Combined with a startling jump in core producer prices (PPI) in February, Bernanke's views suggest the Fed will be raising interest rates to 5% in the next month. All of which has helped send the dollar back upwards following last week's decline of over 2% vs six other major currencies.

Even if you spend all your days staring at charts and indicators, it's always good to poke your head out into the real world from time to time to see what economic factors are shaping the trends you see on screen every day. So read and learn, and then, if you're like me, go back to your moving averages, Bollingers, oscillators and all the other fun toys that make news look dull.

Article cited:
Dollar keeps gains as U.S. rate outlook reassessed