Ben Bernanke Delivers Sobering Speech Following Dollar Dip

On Thursday investors braced themselves for a sobering speech from Federal Chairman Ben Bernake, after the dollar dropped lower than the yen to hit an all time record low for the last 15 years.

Given the present state of the economy investors are a little less than eager to make investments. After Bernanke’s gives his speech on his thoughts on the present economy, investors will be able to adjust their spending attitudes duly. Bernake will address these issues in the annual Federal Reserve conference in Jackson Hole Wyoming.

In a research note taken by analysts at JPMorgan, it is believed that investors will be looking for hints that the government has a positive view of the economy. It is also believed that investors will be also looking for hints of further expansion to the balance sheet.

According to an announcement made by the Federal Reserve, the government plans to restore the sinking economy by pumping money gotten from matured bonds into government debt. Unfortunately although this may help boost the economy, it does nothing but add to the countries massive $ 2.3 trillion deficit budget.

On Thursday the dollar hit 15 year low of 83.58 yen after dropping 0.1 % against the yen. Given the circumstances it is unlikely that exporters will sell the U.S dollar any time before August 31st.

It seems that the U.S dollar is not the only currency have a bad day in the stock market. The Euro also 0.1%, which resulted in $1.2704 EUR=.  A gentlemen serving as a foreign exchange broker, gave hints that in order to control the power of the yen, the Japanese authorities may engage in monetary easing or yen-selling intervention.