The US dollar had amazingly good week as the signs of an end to Federal Reserve’s quantitative easing helped the currency to soar, outperforming all other most-traded currencies.
The Fed’s policy announcement overshadowed all other events of the week. It rocked the Forex market and made stocks, bonds and commodities crash. Some analysts thought that the reaction was excessive, but it did not change the fact that most market participants believed that reduction of stimulus is inevitable and it will happen quite soon.
The dollar was virtually a single winner this week. Surprisingly enough, the yen was weaker against other majors despite the risk-adverse environment that was supportive for the currency’s role as a safe haven. Gold also came crashing down even as low prices for bullion attracted physical demand.
EUR/USD slumped from 1.3346 to 1.3122 this week. GBP/USD tumbled from 1.5726 to 1.5420. USD/JPY surged from 94.14 to 97.76.
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