Market News
March 20, 2013 @ 9:52 pm

Dollar eases against most majors as risk appetite builds after Fed meeting

The Federal Reserve policy meeting ended on Wednesday with a press conference by Fed Chief Ben Bernanke, who lifted risk appetite in the markets.

Risk currencies traded higher against the dollar, and against the safe haven yen, the dollar surged.

The Federal Reserve announced it will continue its bond-buying policy at $85 billion a month to prop up the US economy. The markets took this as a positive, since such measures have so far helped improve economic conditions.

The Fed Chairman said he sees no risk such quantitative easing measures pose to the financial system.

The Fed statement said that the US economy has strengthened at a moderate pace with an improving labor market and the attached updates to economic forecasts showed a downward revision to unemployment rate predictions for 2013.

The Fed currently doesn’t see anything out of line in the stock market. Bernanke said that the nominal all-time highs aren’t so impressive when adjusted for inflation, and the relation between stock prices and earnings is not unusual at this point, with businesses throwing off a lot of profits.

USDJPY climbed to a high of 96.12 yen, moving back toward a 3-1/2-year high of 96.69 set last week.

EURUSD rose 0.4 percent to $1.2971, rebounding from $1.2843 reached on Tuesday, its lowest since late November.

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