More Reason to See Dollar Weakness in the Future

The U.S. dollar is showing weakness today in currency trading on the FX market as risk currencies like the Australian dollar head higher. There is a degree of risk appetite today, as investors look with great favor on chances of a sustainable economic recovery -- at least on a global scale.

In the U.S., housing market numbers are still disappointing, and the job market remains stagnant. Indeed, the U.S. dollar could owe some of its current issues to reduced faith in U.S. fundamentals.

The long term forex trading forecast, though, could call for even more U.S. dollar weakness. China is making moves to reduce its need for the dollar, as evidenced by its latest agreement with Hong Kong. GFT's Kathy Lien reports in FX360 on how China is looking to promote the yuan -- possibly at the expense of the U.S. dollar:

Also weighing on the U.S. dollar is China's decision to open their bond market to Hong Kong banks, which is a big step to stimulate more global Yuan flow.  This decision is another step towards boosting the status of the Yuan and reducing the country's dependence on U.S. dollar.