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Dollar Weakens as Obama Extends Tax Cuts

December 7, 2010 at 13:42 by Vladimir Vyun

US DollarThe US dollar weakened today as the investors’ demand shifted from the safer currencies to the higher-yielding ones after the US President Barack Obama said he’s going to sustain the tax cuts.

The middle-class tax cuts, introduced by the administration of George W. Bush, were set to increase on December 31st. The news about prolonging of the tax cuts spurred the markets: the MSCI World Index of stocks went up 0.4 percent and the Stoxx Europe 600 Index gained 0.7 percent. The Dollar Index slipped 0.2 percent to 79.418.

EUR/USD went up from 1.3306 to 1.3361 as of 11:42 GMT today. USD/JPY traded at 82.60 after it opened at 82.66 and dropped to 82.32.

If you have any questions, comments, or opinions regarding the US Dollar, feel free to post them using the commentary form below.

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