Posted October 30, 2010
Dollar down against most currencies. Fed meeting and US growth weigh on traders.
During the Friday currency trading session, the US dollar turned lower against most of its major rivals. This comes after reports out of the US on growth and consumer confidence fell and investors poised themselves against the upcoming Federal Reserve meeting to be held next week.
The ICE Dollar Index showed the US dollar at 77.255 against a basket of currencies on Thursday in New York trading. It moved to 77.205 for the day on Friday. The index fell by 0.3 percent for the week. Overall for the month of October, the Index shows the US dollar at 1.9 percent lower than the previous month.
Many of the US dollar’s losses stem from the concerns of the Federal Reserve, which is meeting next week. It is expected that the central bank will buy US debt to help lower interest rates and to help encourage consumers to spend. This is in the hopes that the US economy will be stimulated to move forward. In order for this to happen, the government will need to add more money to the system. Doing that will reduce the value of the US dollar. Due to that concern, many currency traders are pulling away from the US dollar towards other currencies in the hopes of selling off prior to the drop in value.
Against the euro, the dollar moved from US $1.3939 as of late Thursday to US $1.3908 by the end of the day Friday. For the week, the euro is down by 0.3 percent against the dollar. It is still up by 2.1 percent against the US dollar against the dollar for the month.
The US Dollar fell from Y 81.01 on Thursday against the yen to Y 80.48. This brings it close to the 15 year low it set earlier in the week of Y 80.41. The lowest level the dollar has been at against the yen was Y 79.75. The dollar has fallen 1.3 percent this week against the yen. It has fallen 3.8 percent against the yen for the month of October. Investors are still watching to determine if the Bank of Japan will intervene in the markets.
The UK pound moved from US $1.5944 to US $1.6033 for the day. The Uk pound moved up 2.2 percent for the week against the dollar. After being down for the month, the UK pound is now up two percent for the month of October.