Tuesday, 28 Sep 2010

Forex Recap: US Consumer Confidence Lowest since February

The dollar fell broadly today as a decline in U.S. consumer confidence, to the lowest level since February, increased expectations that the Federal Reserve is more likely to print money in order to buy assets.

The euro surged to a five-month high against the greenback, smashing a key resistance level and option barriers on its way up, a signal of further gains in the single euro-zone currency.

The yen also firmed, pushing the dollar to below 84 yen, its weakest since Japan intervened in the foreign exchange market two weeks ago to halt its currency's rise.

On Wall Street, U.S. stocks rose on the expectations the Fed will pump more money into the economy, which Shirai said brought out more risk-takers, benefiting the euro and higher-yielding currencies such as the Australian dollar.