I think on the margin the U.S. data makes currency traders more hesitant to put on strong positions. The U.S. economy is still growing at a strong pace, and the Fed might have to raise rates longer than anticipated. |
Its a realization that although consumer inflation has been benign, we always have these fears lurking in the background. |
One reason we are seeing some volatility is that there are nervous bond investors who own Treasuries. |
The big shift for 2006 will be interest rates rising outside the U.S.. |