Daily FNArena News - FYI

There is a raft of economic data being released in the US this week which will go some way to fuelling the argument of whether the Fed goes again. Australia takes a rest.

The Dow had added 53 points on the close to finish a tumultuous week up 2.8%.

A once stoic BoE has bowed to Gordon Brown as a result of Northern Rock, while Governor King is burnt at the stake.

Wall Street began to feel more edgy last night as the US dollar accelerated its slide against major currencies. Mixed earnings reports included a shock result from Goldman Sachs.

Positive momentum carried through on Wall Street last night. Base metals in London posted the gains they would have made yesterday had the exchange not closed before the Fed announcement.

Weekly musings from your editor. Are you ready to be surprised? Here’s a question and some answers that will surprise you, I promise.

July TIC data showed that the flow of foreign funds into the US was already starting to dry up even before the proverbial hit the fan in August.

Just as important as the rate cut itself is the accompanying Fed rhetoric.

The Fed cut the target rate and the discount rate by 50 basis points last night. The Dow rallied 336 points. The US dollar fell to a record low. Gold surged to a 27-year high. Oil surged to a record high. The Aussie jumped US2c.

Swift and decisive actions taken by the Bank of England and the British government are likely to have killed the global liquidity crunch, say GaveKal analysts.