Dollar's 7-Month High Reflects Fed, ECB Policy Split on Horizon
- Goldman Sachs sees rally continuing up to ECB's Dec. 3 meeting
- U.S. Fed moves closer to December rate increase, futures show
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The dollar rose to a seven-month high against the euro as speculation mounted that the European Central Bank is prepared to provide more monetary stimulus to revive inflation, diverging from the Federal Reserve’s plan to raise interest rates.
The U.S. currency strengthened as reports showed Wednesday orders for business equipment climbed more than forecast and purchases of new homes rebounded in October, setting the stage for the central bank to potentially raise interest rates on Dec. 16 for the first time since 2006. Goldman Sachs Group Inc. says the rally may continue up to the ECB’s Dec. 3 meeting.