Forex News

Live Forex news from all over the world.

    Archives

Dollar Rallies After Fed Meeting, Keeps Gains

September 18, 2014 at 5:07 by Vladimir Vyun

A sheet of new hundred-dollar billsThe major event this week was the monetary policy meeting of the Federal Reserve that ended yesterday. While the Fed did not present clear timing for a start of monetary tightening and the tone of the statement was not much more hawkish than it has been before, the US dollar rallied nevertheless and continued to rise today.

The Fed trimmed its bond-purchasing program by another $10 billion and central bank’s chief Janet Yellen said at the press-conference after the gathering that quantitative easing will likely be ended next month. The statement kept the wording that suggested interest rates will remain low for a “considerable time”. This led to speculations that an interest rate hike will not happen as soon as dollar bulls were hoping for. The Fed also released its plans for eventual normalization of monetary policy, but Yellen said:

Let me underscore that our release of this information is not meant to convey any change in the stance of policy.

The dollar was not very strong ahead of the policy meeting, especially after a report revealed that consumer prices fell last month unexpectedly, but the currency rallied after the policy announcement. While the statement was not that positive for the greenback (though not negative either), there were two policy makers who thought that the economy fares well and the pledge to keep borrowing costs low for a prolonged time is unnecessary.

EUR/USD fell from 1.2865 to 1.2859 as of 5:05 GMT today after touching the low of 1.2835 — the weakest rate since July 2013. GBP/USD slipped from 1.6273 to 1.6258. USD/JPY rallied from 108.36 to 108.79 — the highest level since September 2008.

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

Leave a Reply

required
required  

Navigation

Menu