Record US deficit fails to flatten dollar

Record US deficit fails to flatten dollar

Story link: Record US deficit fails to flatten dollar

TAGS:

The dollar stayed about the same on Tuesday in spite of the announcement that the U.S. trade deficit had hit an all-time high in February.

The deficit reached $61 billion in February; it had been $58.3 billion in January.

The increase was mostly blamed on increases in oil prices.

Despite the rise in the deficit, however, some experts said the news could have been much worse.

In order for trade data to effect the dollar substantially and in the long term, some analysts felt, trade data must be much worse than was expected.

This was not the case Tuesday, and in early trading in New York the dollar stood about the same in relation to the euro, at $1.296, recovering from an early dip when the trade data was released.

It remained to be seen what effect the expected release of interest rate data by the Federal Open Market Committee would have on the dollar.