U.S. Dollar Extends Slide Against Most Majors

U.S. Dollar Extends Slide Against Most Majors




The U.S. dollar has been extending its decline against most major currencies on Thursday in response to Federal Reserve's commitment to keep interest rates low until 2014.
The Federal Reserve left interest rates at near-zero levels and reiterated that economic conditions are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014. Fed Chairman Bernanke assured that all policy tools remain at the Fed's disposal, but analysts say the Fed's optimistic outlook takes additional asset purchases off the table barring a turn for the worse for the economy.
Additionally, the central bank said it now expects GDP to increase by 2.4 to 2.9 percent in 2012 compared to its previous forecast for 2.2 to 2.7 percent growth.
The dollar is trading at a fresh 3-week lows of 1.3256 against the euro and 0.9067 against the franc, compared to yesterday's close of 1.3222 and 0.9092, respectively. The next downside target level for the dollar is seen at 1.300 against the euro and 0.900 against the franc.
Against the pound, the dollar is trading at a new 7- 1/2 -month low of 1.6207. If the dollar weakens further, it may likely target the 1.630 level. At yesterday's close, the pound-dollar pair was quoted at 1.6167.
The US dollar that closed Wednesday's trading at 0.9836 against the Canadian dollar is now trading at a fresh 7-month low of 0.9810. On the downside, 0.970 is seen as the next target level for the greenback.
The US dollar is trading at an 8-day low of 1.0395 against the Australian dollar and a 1-week low of 0.8192 against the New Zealand dollar. The next downside target level for the greenback is seen at 1.042 against the aussie and 0.824 against the kiwi. The aussie-greenback and the kiwi-greenback pairs were worth 1.0355 and 0.8148, respectively at yesterday's close.
Early in the day, the Reserve Bank of New Zealand left its benchmark interest rate unchanged at 2.50 percent and said the current rate is "appropriate". The central bank has been holding its rate at 2.50 percent since March 2011.
The dollar eased against the yen, with the pair currently trading at 81.15, down from yesterday's close of 81.34. If the dollar slides further, it will break 81.0 level and target 80.5 level.
Looking ahead, Eurozone economic sentiment survey results are slated for release at 5 am ET.
The U.S. pending home sales for March and the weekly jobless claims report for the week ended April 21st are expected in the New York morning session.


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