US Dollar Gets Boost Ahead of Fed Minutes

US dollar is getting a boost today, thanks to expectations associated with the upcoming release of the minutes from the last Federal Reserve meeting. Thanks to the latest economic data, some feel that the Fed minutes will show discussion about tapering the asset purchase program. Some think that the minutes will indicate that tapering will come sooner rather than later.

The Federal Reserve‘s asset purchase program is part of a quantitative easing effort aimed at increasing the money supply. With more money to go around, the expectation is that the economy will improve. With the economy showing signs of recovery, many think that the Fed will decide to pull back its efforts.
More money in circulation means a less valuable dollar. If tapering goes into effect, the dollar should gain in value. Indeed, speculation that tapering could begin soon is prompting some small gains for the greenback today, especially against the euro. Good news out of the United Kingdom is helping the pound hold its own, but other currencies are struggling against the US dollar for now.
At 15:53 GMT EUR/USD is down to 1.3367 from the open at 1.3417. GBP/USD is up to 1.5680 from the open at 1.5668. USD/JPY is higher, rising to 97.6450 from the open at 97.2800.

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