On June 7th Ben Bernanke, Chairman of the US Fed Reserve, made a speech in Atlanta at the IMF Conference. According to him, the slow pace of economic recovery provokes further stimulation while the inflation growth will be temporary as all the necessary steps will be taken to curb it.
The latest data on the weakness of the US economy, including high unemployment (9,1%) in May, will force the Fed Res to keep maintaining the key interest rate around zero in 2011 and probably in 2012. The growing consumer prices (including the prices on fuels) will probably see a decline in the second part of 2011 after the Japanese plants recover from the tsunamis and earthquakes.
In general the US economy keeps recovering, even though the pace is slow in some sectors because of the high unemployment rate, Bernanke said at the end of his speech.
FOREX.
The US Dollar keeps declining in value against some other major currencies. According to the Department of Masterforex-V trading system , the USD index keeps moving down and developing the “Hound of the Baskervilles” pattern of Daily2. A bearish FZR will confirm it. 72,86 will become a support level.
If the downward scenario is cancelled, the price will form a “moment of truth” and a bearish FZR of Daily1, which will indicate that the index will keep retracing in mid-term perspective against the long-term downtrend. 74,44 will become a resistance level.
