Dollar falls on Fed QE3 news
NEW YORK – The Federal Reserve’s announcement of an open-ended QE3 program and pledge of low rates until mid-2015 sent the dollar falling Thursday against major currencies.
Although some monetary easing action was expected, the stance of the Fed’s policy board, declaring that easing measures would stay in place indefinitely until the jobs market improves substantially, was stronger than expected.
At 2100 GMT, the euro was at $1.2986, up from $1.2899. It momentarily topped the $1.30 level for the first time since early May.
The dollar fell to 77.48 yen from 77.84 yen, and to 0.9353 Swiss francs from 0.9372 francs. The British pound pushed up to $1.6152 from $1.6107.
The euro, meanwhile, pushed up to 100.61 yen from 100.40 yen.
“As the Fed refrains from embarking on an unlimited buying program, currency traders may start to scale back their bearish forecast for the US dollar,” said David Song of DailyFX.
“But the fresh batch of central bank rhetoric may provide a clear directional bias for the greenback as market participants weigh the outlook for monetary policy.”
“Pretty much all currencies against the US dollar are reaching substantially higher levels than when they started the day,” said Neil Gilbert of GFT.
“Outside of the currency market, equities are soaring, precious metals are jumping, but oil has been rather subdued.”
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