The ICE US Dollar Index headed higher this week and pushed nearer the 81 mark after the Federal Reserve finally started it’s long awaited tapering strategy to wind down US bond buying next year amid signs that American economic growth is picking up.
Latest ICE US Dollar Rate
The ICE Dollar Index, which tracks the US dollar against five major world currencies including the euro and UK sterling edged up to 80.980 earlier in trading on Friday and closed the session at 80.745.
Fed Tapering Gets Underway
The Federal Open Market Committee announced on Thursday that it would slow monetary stimulus to $75 billion a month from $85 billion which immediately boosted the dollar’s value on currency markets, however the broader picture remains strategically unchanged.
“The dollar has taken a lot of strengthening from the tapering news, and I do expect it to continue,” Fabian Eliasson, head of US currency sales in New York at Mizuho Financial Group Inc., said in a phone interview.
According to brokers, the market had already factored in the much awaited announcement about stimulus roll back. The US central bank will still pump money into the US economy, only a little more slowly than previously.
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US Dollar Index heads nearer 81 after Fed finally starts it’s tapering strategy
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