The major theme of this week was speeches of various Federal Reserve members and, most importantly, Chairman Ben Bernanke. Comments of policy makers did not help to understand when the central bank is going to end quantitative easing. The confusion resulted in a mixed performance of the US dollar.
Bernanke did not clear things up, warning about the danger of premature end to QE, but at the same time saying that the Fed may slow its asset purchases. Nevertheless, most analysts decided that such comments mean reduction of stimulus in the near future. Such view boosted safer currencies, helping the dollar, but also allowing the yen and the franc to outperform the US currency.
Commodity currencies, like the Australian and Canadian dollars, suffered from the resulting risk aversion. The pound suffered from concerns about its economic well-being, but, interestingly enough, the euro managed to gain even in such unfavorable conditions.
EUR/USD was up from 1.2841 to 1.2934 this week and the weekly high was at 1.2997. USD/CHF declined from 0.9698 to 0.9609 after rallying to 0.9837, the highest level since July. AUD/USD slid from 0.9753 to 0.9650 and its weekly low of 0.9591 was the weakest since May 2012.
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