The dollar fell against most of its 16 major counterparts before Federal Reserve Bank of New York President William Dudley speaks today amid speculation the U.S. recovery isn’t fast enough to deter further monetary easing.
The Dollar Index slid from a five-week high before government data today expected to show that the number of Americans filing for unemployment benefits rose last week from a seven-month low. The yen slid against the Australian dollar as futures indicated a U.S. stock gauge will rise, damping demand for safer assets.
“The U.S. economic recovery is slow, and the biggest problem is employment isn’t improving very much,” said Marito Ueda, senior managing director in Tokyo at FX Prime Corp., a currency margin company. “Because an interest-rate increase isn’t anywhere in sight, nobody is willing to buy the dollar.”
The dollar dropped 0.3 percent to $1.3506 per euro as of 2:43 p.m. in Tokyo, breaking a three-day winning streak. The yen lost 0.3 percent to 104.02 per euro and was little changed at 77.02 per dollar. The Japanese currency retreated 0.2 percent to 77.86 per Australian dollar.
The Dollar Index, which IntercontinentalExchange Inc. uses to track the greenback against the currencies of six major U.S. trading partners, lost 0.4 percent to 78.069 after reaching 78.467, the highest since Oct. 10.
Standard & Poor’s 500 Index futures rose 0.6 percent. The MSCI Asia Pacific Index of shares advanced 0.3 percent, reversing a decline of as much as 0.8 percent.
Jobless claims in the U.S. rose to 395,000 last week from 390,000 the previous week, which was the least since April, according to economist estimates before the government report due today.
Dudley said last month that it’s “possible that we could do another round of quantitative easing.” The Fed has conducted so-called quantitative easing twice, in which the central bank buys government debt to stimulate the economy through lower borrowing costs.
The central bank announced in September announced a plan to replace $400 billion in shorter maturity debt holdings with longer-term securities in a bid to reduce borrowing costs.
To contact the reporters on this story: Candice Zachariahs in Sydney at czachariahs2@bloomberg.net; Masaki Kondo in Singapore at mkondo3@bloomberg.net
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
