US Dollar Index Rises on ECB Balance Sheet

US dollar index is rising as Forex traders look for a little safety. The news that the European Central Bank balance sheet is soaring, with new bank lending jumping, has many searching for a little stability. And that means that the US dollar has the upper hand against  high beta currencies right now.

Forex traders and investors are feeling risk averse right now. Even though consumer confidence is on the rise in the United States, there are still issues to overcome — one of them being falling home prices. Combine that with concerns about the eurozone, and many are just looking for a little stability and safety.
Concerns about what’s next for the eurozone, and whether or not the ECB can handle its burgeoning balance sheet are very real right now. On top of that, there are some concerns, too, about China’s ability to maintain the growth necessary to keep a global economic recovery going. With all of this, it is little surprise that the dollar index is rising.
A strengthening dollar is also putting pressure on commodities. Gold prices and oil prices are falling today, with gold prices sliding for a fifth day, and oil prices threatening to fall below $100 a barrel.
At 16:53 GMT, EUR/USD is down to 1.2932, from the open at 1.3070. GBP/USD is also lower, at 1.5481, down from the open at 1.5671. USD/JPY is higher at 77.9710, up from the open at 77.8745.

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