U.S. dollar falls amid Fed's strong currency concern

BY  | FROM Xinhua | 2014-10-09 10:40

  NEW YORK, Oct. 8 (Xinhua) -- The U.S. dollar declined against most major currencies Wednesday after minutes from the Federal Reserve's latest policy meeting showed officials were concerned that the global economic slowdown and a stronger currency could pose risks to the outlook of U.S. economy.

  The dollar index, which measures the greenback against six major currencies, was down 0.41 percent at 85.321 in late trading.

  According to minutes of the latest Federal Open Market Committee (FOMC) meeting released Wednesday, some officials said Europe's waning economy and low inflation could lead to a further appreciation of the dollar, which might curb U.S. exports and limit price gains that have lagged behind the Fed's goal.

  Moreover, a number of participants of the meeting said U.S. economic growth "might be slower than they expected if foreign economic growth came in weaker than anticipated."

  The International Monetary Fund (IMF) lowered its forecast for global economy growth this year and next in its updated economic outlook on Tuesday, echoing the earlier concerns of Fed officials. However, IMF said the U.S. economy is seen to expand 3.1 percent this year, higher than its forecast of 3 percent in July.

  The ongoing upward momentum of U.S. economy had long been supporting market speculations that Fed may increase interest rates before mid-2015, but the newly-released minutes added bets that the central bank may keep the current low interest rates longer.

  The FOMC last month pledged to keep interest rates near zero for a "considerable time" after it concludes an asset purchase program that's due to end after its October meeting.

  In late New York trading, the euro increased to 1.2731 dollars from 1.2658 dollars in the previous session, and the British pound went up to 1.6160 dollars from 1.6080 dollars. The Australian dollar edged up to 0.8832 dollar from 0.8812 dollar.

  The dollar bought 108.16 Japanese yen, higher than 108.15 yen of the previous session. The dollar went down to 0.9524 Swiss francs from 0.9578 Swiss francs, and it decreased to 1.1107 Canadian dollars from 1.1173 Canadian dollars.

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