Dollar index climbs a tad

Published: 13 Sep at 12 PM Tags: Euro, Dollar,

The dollar index has pushed higher after yesterday hitting its lowest level in two weeks. Although the dollar is up, the US currency is still under pressure because of doubts that the Federal Reserve will pull back its monetary stimulus programme as significantly as was previously expected. All eyes are now on a meeting at the central bank next week. However, disappointing job figures at the end of last week are an indication that the Fed will be cautious about reeling in its bond buying.

Following Thursday’s rally, the yen has dropped slightly. The dollar is currently worth 99.60 yen, a rise of 0.1 per cent. The euro has also dropped 0.1 per cent against the dollar to $1.3283.

The emerging market currencies have recovered somewhat from recent lows and a dovish reaction from the Fed is likely to boost that recovery.

Today’s rise in the dollar was also caused in part by rumours that former treasury secretary, Lawrence Summers, will take over as head of the Federal Reserve. Ben Bernanke is due to step aside in January.

The Australian dollar appears to be under pressure again after rising on the back of positive economic data from its biggest trading partner, China. The Aussie dropped 0.7 per cent to $0.9266.