Forex News : David Woo, head of Global FX Strategy at Barclay Capital, has some interesting calculations for consideration regarding the correlation between the dollar and oil prices. "A 1% positive shock (rise) EUR/USD leads to a 1.2% increase in oil prices while a 10% shock in oil prices leads to a 1% increase in EUR/USD," notes Woo. "Our results strongly suggest that the difference in the relative importance of price stability in the policy objective function of the Fed and ECB has magnified the correlation between oil and the USD. "
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