US dollar is heading a little bit lower today, slipping as news points to easing for the greenback. The German court ruling gave the euro a boost, and the expectation that the Federal Reserve will announce the possibility of more stimulus is undermining the greenback a bit.
The members of the Federal Open Market Committee are starting a two-day meeting today, and tomorrow Ben Bernanke will announce a policy position. Many expect him to continue to say that more stimulus is an option if the US economy doesn’t show good improvement. Some even expect an actual QE3 announcement.
At any rate, the US dollar continues to struggle as better news reduces the need for safe haven, and as the prospect for an increased money supply points to the possibility of inflation and a less valuable dollar. So far, the dollar’s losses have been somewhat limited, since Forex traders are largely waiting to see what happens with the Federal Reserve announcement, since Bernanke’s words will carry a great deal of weight.
At 15:30 GMT EUR/USD is up to 1.2890 from the open at 1.2855. GBP/USD is also higher, up to 1.6100 from the open at 1.6071. USD/JPY is a little bit higher at 77.8790, up from the open at 77.7720.
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