Trade Deficit Increases — And So Does Risk Appetite on the FX Market

U.S. dollar weakens in currency trading

The trade deficit increased to its widest level since November 2008, and that is having the effect of helping risk appetite on the FX market. Why? Because a widening trade deficit indicates that Americans are getting ready to spend money. And when consumers start spending, the economy picks up. GFT’s Kathy Lien looks at the trade deficit in FX360:

The details of the report showed a pickup in external and internal demand that had nothing to do with commodity prices.