The U.S. dollar continued to go down today against the euro and the yen as the traders expect a rate cutting decision from the Federal Reserve and the bailout of the U.S. automakers.
While both interest rate cut and the bailout of the countrys biggest car-making companies are the positive factors for the whole U.S. economy, they are certainly hurting the U.S. dollar, which may continue depreciating on the Forex market. The dollar went down to the lowest level in the last 7 weeks against the euro and traded below the Fridays close against the Japanese yen.
There are chances that the interest rate in the United States will be reduced to 0.5 percent during the two-day FOMC meeting, which begins today. Analytics see no real obstacles for the dollar to continue depreciating, especially against the euro, as the most of the funds repatriation is already over and the European currency looks excessively oversold now.
EUR/USD rose from 1.3390 to 1.3475 as of 10:19 GMT today after reaching 1.3499 — its highest level since October 20. USD/JPY declined slightly from 90.93 to 90.75 with the daily low at 90.48. GBP/USD went up from 1.4958 to 1.5015.
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