14.12.201014:57 Forex Analysis & Reviews: Fundamental Analysis, December 14, 2010

A mixed trend has been observed this morning on Asian stock markets after mixed performance on Wall Street last night. Wall Street indexes signaled stability at the opening of trade this morning.

Wall Street opened the week on a mixed trend based on improvements in growth predictions for the American economy, and the fact that the Chinese central bank has not raised the interest rate this year despite inflation in the country accelerating to the highest level in the last two years. By the end of the trading day, the Dow Jones Industrial Average rose by 0.2% to a level of 11,428 points, and the S&P 500 locked on a slight rise to a level of 1,240 points, whereas the NASDAQ index dropped by 0.5% to a level of 2,624 points.

55 economists who participated in the Wall Street Journal's monthly economist poll are now predicting an annualized GDP grow of 2.6% on average this quarter in the United States, as opposed to a 2.4% growth prediction in last month's poll. The poll also pointed to an improvement in economists' predictions for next year. On average, the economists are predicting a 3% growth for 2011. At the same time, the chances for a double-dip recession have also reduced, and are now at 15% - the lowest level in 2010 – as compared to 22% in the Wall Street Journal's September poll.

The price of oil leaped up yesterday by more than 1% to a level of 88.5 United States dollars per barrel, after OPEC countries had left oil production unchanged due to declined demand and the weakening of the dollar. OPEC left its oil production at 24.84 million barrels per day.

In the global currency market, the dollar's value had taken a sharp dive yesterday, whereas the Euro leaped up by 1.55%, trading around the levels of 1.34 United States dollars for one Euro. The sharp dive in the greenback's value is the result, in part, from the decision to extend the tax cuts in the United States, which may cause America's budget deficit to balloon further.