What happened on 8/7/08-8/8/08 that has caused this huge rally in the dollar?

Question

Have global companies pulled their long positions out of oil and dollar-short hedges?

Is there ever a way to find out for sure, or do you just have to hypothesize?

What is the "stated" catalyst (i.e., the 'catalyst' according to analysts)?

Answer 1

Growing signs of deceleration in European economic growth caused the Euro to fall against the USD.  Oil fell as a result of the USD's rise, not the opposite.

Answer 2

Or maybe there is rumblings of Europe is going to lower their rates, which will weaken their currency.  Hence, strengthen the dollar. They

always seem to work opposite of eachother.

Answer 3

The surge was cause by the ECB who realized that they will have to stop raising interest rates in Europe and maybe even cut.  Check out my site for some ideas and post a few comments.  http://unbiasedstockanalysis.blogspot.co...

Answer 4

The drop in oil prices caused the dollar to surge.