Dollar Weakens as Fed Joins ECB to Increase Monetary Stimulus
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The dollar fell versus most its major counterparts after the Federal Reserve’s plan to begin a third round of asset purchases to bolster the economy raised concern the measure will debase the value of the U.S. currency.
The U.S. currency weakened to a four-month low against the euro and seven-month low versus the yen as the central bank said it will expand its holdings of long-term securities with open-ended purchases of $40 billion of mortgage debt a month. European Central Bank President Mario Draghi said last week that policy makers had agreed on an unlimited debt-buying program for the region. Canada’s dollar and Mexico’s peso advanced as stocks and commodities rallied on increased demand for riskier assets.