» Forex - Dollar fell on weak US data and Mr. Trichet’s comments

The Dollar fell for a second straight session on Wednesday, weighed down by surprisingly weak US durable goods orders and remarks by ECB chief Jean-Claude Trichet that Euro-zone rates were at the right level.
Analysts said Trichet’s comments, with news that German and French business confidence unexpectedly improved in March, dampened expectation of a soon ECB interest rate cut. That left investors focusing on the widening interest rate differential between the US and the Euro zone.
The Federal Reserve has slashed its benchmark overnight lending rate by 3% to 2.25% since mid-September, while the ECB has kept its rate at 4%. Lower interest rates make Dollar-denominated assets less attractive.
Interest rate futures are pricing in a roughly 46% chance of a 50bp cut in the Fed funds rate target next month, to 1.75%.
Data on Wednesday showed new orders for long-lasting US goods declined 1.7% last month and a key measure of companies’ appetite for investment also contracted.

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