ETFs Trade in Narrow Range After Bernanke Comments
February 10th at 10:00am by Tom Lydon
Federal Reserve Chairman Ben Bernanke today outlined the Fed’s plan to unwind stimulus measures and raise interest rates once the economy is on more solid ground. The news didn’t have much impact on exchange traded funds (ETFs) or the markets, which are trading flat so far today.
Bernanke said the Federal Reserve will tighten credit by raising interest rates, meaning companies and Americans will pay more to borrow funds. That said, these plans aren’t imminent. Bernanke told a House committee that the central bank is a ways away from raising rates, reports the Associated Press.
The U.S. trade deficit unexpectedly widened in December as imports rose faster than exports. The $40.2 billion gap is the biggest in a year, says Courtney Schlisserman for Bloomberg. American goods are becoming more appealing on the global stage, thanks to rapid growth in developing countries and a weaker dollar.
The euro is slipping today as investors remain uncertain about the situation in Greece. Rumor has it that Germany may step in and either buy Greece bonds or by guaranteeing its sovereign debt, reports Bradley Davis for The Wall Street Journal. CurrencyShares Euro Trust (NYSEArca: FXE) is down 4.4% in the last month.
The Greece crisis worries are also causing gold prices to step back a little, sending investors out of riskier assets and into the U.S. dollar. Officials don’t expect any decision regarding the bailout in Greece today, but anything could happen. ETFS Gold Trust (NYSEArca: SGOL) is down about 0.3% this afternoon.
Read the disclaimer, as Tom Lydon is a board member of Rydex|SGI.
