Alexa
  • Directory of Taiwan

Dollar rises from recent lows

Dollar rises from recent lows

The dollar edged up by midday Friday against the euro and the pound after sinking to multimonth lows earlier.
A broad measure of the dollar's value ticked up 0.1 percent after dropping about 8 percent since Federal Reserve Chairman Ben Bernanke first hinted that the Fed was ready to act to provide further support to the economy. He underscored those expectations on Friday.
Investors expect the Fed to announce at its meeting in early November that it will begin buying bonds, driving interest rates still lower. That would hurt the dollar's appeal for investors.
In midday trading in New York, the euro fell to $1.4030 from $1.4057 late Thursday. Earlier in the day, it hit a nine-month high of $1.4157. The British pound rose to $1.6034 from $1.5987 after peaking at $1.6104, its highest point since January.
The dollar dipped to 81.28 Japanese yen from 81.43 yen, but remained above Thursday's 15-year low of 80.94 yen.
The Australian dollar was worth more than one U.S. dollar early on Friday, for the first time since the Australian currency became freely traded on the market in 1983.
While investors expect the Fed to give a boost to the economy, the European Central Bank has shown no signs of considering similar action. That has helped drive the euro since late August.
In other midday trading, the dollar edged up to 1.0088 Canadian dollars from 1.0070 Canadian dollars, and rose to 0.9561 Swiss francs from 0.9529 Swiss francs.
Analysts expect that the dollar likely has further to fall because of the Fed's expected move. "The implications for the (U.S. dollar) are stark," said Michael Woolfolk, an analyst with Bank of New York Mellon, in a research note. U.S. interest rates will be lower, which makes the dollar less attractive since it is used to buy U.S. assets.
But a weaker dollar may help the U.S. economy. The Fed hopes its program will boost buying and spending by consumers and companies, raise inflation and bring down the unemployment rate. A weaker dollar could help propel U.S. exports and drive prices higher.