Dollar Rises From Lowest in Week on Bets Fed Will Taper

The dollar rose from the lowest level in a week as investors wagered the Federal Reserve is still moving toward reducing its bond buying after chairman-nominee Janet Yellen said it “will not continue indefinitely.”

The yen weakened beyond 100 per dollar for the first time since September after a government report showed economic growth slowed, adding to the case for the Bank of Japan to boost stimulus. Emerging-market currencies rose on bets the Fed will continue its asset purchasing. Yellen said in Washington testimony she is committed to promoting a strong recovery and will ensure monetary stimulus isn’t removed too soon.

The Bloomberg U.S. Dollar Index, which monitors the greenback against 10 major counterparts, was little changed at 1,018.82 at 5 p.m. in New York after dropping to 1,015.83, the lowest since Nov. 7. It fell 0.4 percent yesterday.

The yen fell 0.8 percent to 100.01 per dollar after touching 100.15, the weakest level since Sept. 11. Japan’s currency declined 0.6 percent to 134.61 per euro. The euro slid 0.2 percent to $1.3461 after declining as much as 0.5 percent.

(Source: Bloomberg)