The FOMC said it will maintain its zero interest rate policy for an 'extended period' in a statement issued after yesterday's meeting. Although the Committee recognises that the economy is likely to be weak for a time, it highlighted an increase in housing market activity and said household spending 'seems to be' stabilising. The apparent lack of conviction in the statement suggests that the Fed may be playing for time after smoothing the road for 'market forces' to support a strengthening of economic growth and agradual return to ‘higher levels of resource utilisation’.
The yen traded near a one-week high against the dollar amid speculation Japanese companies returned from a three-day holiday to repatriate funds before the end of the fiscal first half. Japan's currency has risen 5.7 percent against the dollar this quarter. A strengthening yen reduces the value of overseas sales by Japanese companies when converted into their home currency. Large manufacturers expected the yen to trade at an average of 94.85 per dollar in the 12 months to March 2010, according to the Bank of Japan's quarterly Tankan survey released July 1.
The Australian dollar advanced toward a 13- month high as the central bank said the nation's lenders are weathering the global recession.
The yen appreciated to 90.49 per dollar as of 8:10 a.m. in London, from 91.29 in New York yesterday, and traded as high as 90.44, the strongest since Sept. 16. It was at 133.54 per euro, from 134.52. The euro rose to $1.4761, after trading as high as $1.4844 yesterday, its highest level since Sept. 22, 2008.
No comments:
Post a Comment