The Dollar fell against most major currencies on Monday after a Federal Reserve insider alluded to interest rates remaining low for some time come. James Bullard, the St. Louis Federal Reserve President said in a speech that the Central Bank should maintain its Troubled Asset Relief Program (TARP) which consumes the mortgage backed securities that are widely credited with starting the crisis. Investors took this as an affirmation that despite pressure from outside the US, the interest rates will remain low for the foreseeable future.
At 11:45PM GMT, the US Dollar was trading down .74% to the Euro to 1.4969, down .62% against the Sterling to 1.6603, down 1.5% to the Canadian Dollar to 1.46%, down 1.06% to the Australian Dollar to .9241 and down .9% against the Swiss Franc to 1.0095. The Dollar did rise versus the Japanese Yen, climbing .22% to 89.07.
A rebound in the commodity and equity markets also marked Monday. Analysts believe that it is too early to say if this is a cause or affect of the Dollars slide as it is expected for the Dollar to gain some strength toward the end of the year. There is no clear signal that risk appetite has returned insomuch as there was a surprise statement which caused a session of panic. The week is short in the US due to the Thanksgiving holiday and traders will be eager to see sales figures from this coming Friday which is widely hailed as the busiest shopping day of the year. Known as Black Friday, it is touted as setting the tone for the rest of the holiday shopping season and carrying retailers from losses (the red) to profit (the black).
Written by Finexo.com