Dollar falls as Fed maintains stimulus
US Currency. AP FILE PHOTO
NEW YORK CITY – The dollar Wednesday tumbled against other major currencies after the Federal Reserve’s surprise decision to maintain its aggressive monetary stimulus program.
The euro traded at $1.3511 around 2200 GMT, up sharply from $1.3356 late Tuesday.
The dollar bought 98.13 yen, down from 99.14 a day earlier.
The euro traded at 132.55 yen, up slightly from 132.38.
The dollar also skidded against the British pound and the Swiss franc.
Heading into Wednesday, investors had been primed for the Fed to scale back its $85 billion per month bond-buying program. Many experts predicted the program would be reduced by $10-$15 billion per month.
But the Fed lowered its economic growth forecast for 2013 and 2014, expressing concerns that reducing the stimulus would harm the economy.
Federal Reserve Chairman Ben Bernanke said the Fed could still taper the program later this year if economic conditions warrant.
The Fed statement “was dovish across the board,” said Jens Nordvig, an analyst at Nomura Securities. The dollar’s “weakening move could continue for several days, accompanied by a renewal of flows into emerging market assets.”
The pound rose to $1.6140, compared with $1.5904 late Tuesday.
The dollar fell to 0.9128 Swiss franc from 0.9259.
