Dollar Jumps vs. Euro on QE Tampering Speculations

The US dollar jumped against the euro today on speculations that the Federal Reserve may perform quantitative easing tampering rather soon. The currency was flat versus the Great Britain pound and fell against the Japanese yen.

Market participants speculate that the Fed may slow the pace of its asset purchases as early as January or perhaps even in December and positive macroeconomic data supports such outlook. The October Chicago Business Barometer rose to 65.9 in October from 55.7 in September, reaching the highest level since March 2011. It was a very nice surprise to dollar bulls, who expected a drop to 55.1. Claims for unemployment benefits fell.

The dollar managed to surge against the euro not only because of good news from the United States, but also with the help of bad news from Europe. At the same time, the pound and the yen were just too strong for the greenback to win against them.

EUR/USD tumbled from 1.3734 to 1.3585 as of 21:58 GMT today. GBP/USD traded at 1.6037, while USD/JPY went down from 98.48 to 98.35, reaching the low of 98.08 intraday.

If you have any questions, comments or opinions regarding the US Dollar,
feel free to post them using the commentary form below.

Be First to Comment

Leave a Reply

Your email address will not be published. Required fields are marked *