The US Dollar Index closed off the Friday’s trading session back under the 79 level as Wednesday’s announcement that the US Fed is considering more QE and further delays in interest rate rises saw the US dollar drop over one percent against other major currencies.
Latest Dollar Index Rate
The ICE US Dollar Index, which tracks the US dollar against six major world currencies was trading at 78.935 at close on Friday.
The euro rose 0.6 percent against the US dollar to push back over $1.31, its highest level in nearly five weeks.
US Fed Policy
The US dollar weakened after the US Federal Reserve extended its pledge on maintaining interest rates at ultra low levels until at least late 2014, much later than traders had expected.
Prices of gold and US government debt rallied on the Fed’s statement on rates and on comments by Ben Bernanke, who left the door open to further monetary stimulus if the US economy deteriorates this year.
Meanwhile, oil prices remained firm as continued tensions over Iran kept the price of US WTI oil futures close to $100 a barrel. US Light oil futures for March delivery dipped $0.14 or 0.1 percent to settle at $99.56 a barrel on the NYMEX on Friday.
A weaker US dollar tends to add weight to higher oil prices as crude becomes cheaper to buy for investors using other currencies. Gold prices and other commodities also gain from a weaker greenback.
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US Dollar Index slips below 79, adding fuel to higher crude oil prices
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