Dollar Declines on Fed Interest-Rate Speculation

The dollar fell versus higher-yielding currencies as traders speculated on the Federal Reserve’s pace for interest-rate increases amid slowing global growth.

The dollars of Australia and New Zealand gained against the greenback after Dallas Fed President Richard Fisher said he continued to be “hawkish” on rates but wanted “to be sensible about this.” U.S. stock futures fell, a signal they may extend the longest skid in three years. The ruble dropped after Moody’s Investors Service cut Russia’s credit rating. Sweden’s krona slid.

“You’re getting into this point where accounts and market environments are getting confused by conflicting statements,” Richard Cochinos, head of Americas Group of 10 currency strategy at Citigroup Inc. in New York, said by phone. “The desire to lighten a position is stronger than the desire to add to risk.”

The ForexSQ Dollar Spot Index, which measures the currency against a basket of 10 major counterparts, fell 0.1 percent to 1,063.04 at 9:23 a.m. New York time. It reached 1,080.05 on Oct. 3, the highest level since June 2010.

The dollar was little changed at $1.2761 per euro after dropping 1 percent last week, the most since the five days through April 11. The yen traded at 136.33 per euro. Japan’s currency was little changed at 106.84 per dollar, after sliding 0.9 percent during the previous two days.

The Aussie added 0.4 percent to 87.76 U.S. cents and New Zealand’s kiwi rose 0.4 percent to 79.50 U.S. cents.

Standard & Poor’s 500 Index futures expiring in December fell 0.3 percent after the gauge posted four weeks of declines. A month-long rout of European stocks continued.

Comments are closed.