US Dollar Rises on Safe Haven Demand

US dollar is rising today against major currencies as a safe haven. Concerns about what’s next for the global economy are causing Forex traders to look for safety — and the US dollar is the best choice.

Concerns about what’s next for the global economy — especially as it relates to the eurozone — are causing some trepidation for Forex traders. Worry that the plan announced by eurozone leaders last week won’t solve the sovereign debt crisis is paramount today. It looks as though there won’t be a long-term solution anytime soon. And, before Greece is properly shored up, it looks as though Italy as about ready to be the next to see serious problems.

With the Bank of Japan intervening to keep the yen lower, it is no surprise that all of the safe haven currency trading is favoring the US dollar. Additionally, with gold as expensive as it is right now, it is not being considered a viable safe haven. Instead, the US dollar is the only available safe haven, and Forex traders are piling in as risk aversion mounts and financial markets drop.

at 13:47 GMT, EUR/USD is lower, down to 1.3993 from the open at 1.4152. GBP/USD is also down, at 1.6051 from the open at 1.6131. USD/JPY is higher at 78.04, up significantly from the upen at 75.69.

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