Expectations rise that Fed will take additional easing measures
By Lisa Twaronite, MarketWatch
TOKYO (MarketWatch) — The dollar slipped against most major counterparts Wednesday, pressured by growing expectations the U.S. Federal Reserve will take additional easing steps at its meeting early next month.
The Federal Open Market Committee will meet on Nov. 2 and 3; officials have recently hinted that more easing could be on the way.
“This perception of additional measures to come from the Fed in particular is weighing on the dollar, with EUR/USD again hitting the eight-month high of $1.3859,” said currency strategists at Brown Brothers Harriman.
Against the Japanese yen, the dollar (USDYEN 82.9800, -0.2100, -0.2524%) fell 0.3% to ¥83.01.
After it surprised with a rate cut on Tuesday, the Bank of Japan repeated Wednesday that the Japanese economy’s moderate recovery is slowing.
“Growth in exports and production has recently been decelerating,” the central bank said in its monthly report on economic and financial developments. It said long-term interest rates have fallen, while the value of the yen against the U.S. dollar and stock prices are “more or less” where they were a month ago.
The dollar index (DXY 77.66, -0.09, -0.12%) , a measure of the greenback against a basket of six major currencies, edged down to 77.656 from 77.749 late Tuesday.
The euro (EURUSD 1.3859, +0.0023, +0.1662%) bought $1.3853, compared with $1.3852 late Tuesday, and the British pound (GBPUSD 1.5898, +0.0012, +0.0755%) gained 0.1% to $1.5908.
