Dollar falls again on Interest rate Worries

Saturday, October 24, 2009

The Dollar retreated yet again on Wednesday as continued doubts over a US recovery focused attention on stagnant interest rates.

Forex Analysts have been speculating that the world’s major economies are winding down their stimulus programs and gearing up to raise rates amidst optimistic signs that a recovery is at hand.

Yet recent words from key US figures like Fed Chairman Bernanke and Treasury Secretary Geithner suggest that the US is a long way from raising their core rates which are hovering near zero. This inaction would diminish demand for the Dollar as yields around the world would prove more profitable for traders.

At 1040PM GMT, the US Dollar was down .47% to the Euro, breaking through the technical 1.50 mark to hold at $1.5013. The Dollar was also down .64% against the Canadian Dollar to 1.0426, down .42% to the Aussie to .9275, down 1.35% to the Kiwi to .7594 and down .55% versus the Swiss Franc to 1.0059. The Dollar was up against the Yen, rising .18% to hold in at 90.92.


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