Dollar Rallies as Fed Fails to Erase U.S. Stimulus Speculation
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The dollar rallied as a weaker-than-forecast unemployment report and the Federal Reserve’s pledge to keep buying bonds failed to erase speculation that policy makers will being winding down the program this year.
The Bloomberg U.S. Dollar Index snapped three weeks of declines even as the Fed said persistently low inflation could hamper the economic expansion. Australia’s dollar declined as the nation boosted its budget-deficit forecast. The euro fell from a six-week high as the European Central Bank said interest rates may stay low for an extended period. The U.S. Census Bureau may report Aug. 6 that the trade deficit shrank in June.