Dollar Drops Further Due to the Impact of the Fed’s Minutes

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Dollar Drops Further Due to the Impact of the Fed’s Minutes The dollar fell for the second consecutive day; paring its losses a day after the Federal Reserve’s most recent minutes indicated that officials are worried the U.S. economic growth may be weighed down by a stronger currency and global economic slowdown.

The U.S. currency remained slightly unchanged at 107.85 yen, as it looked set to record a weekly drop of 1.7 percent, its first since the week through Aug. 8. The dollar advanced 0.6 percent to trade at $1.2617 per euro, while the yen rose 0.6 percent to 136.10 per euro after the European Central Bank President Mario Draghi expressed fears the euro-area economy was slowing down.

“The reason why the market may have gotten a little bit of market indigestion over the minutes was that there really wasn’t much to focus on this week,” Michael Woolfolk, a New York-based global-markets strategist at Bank of New York Mellon, told Bloomberg News. “The dollar strengthening trend is to continue in the medium to long term but in the short term we’ve really come too far, too fast. So we expect to see some consolidation of dollar gains.”

The Norway’s krona fell after inflation data lagged expectations. The underlying consumer prices in Norway jumped 2.4 percent in September, compared with the median forecast of 2.6 percent expected by analysts. The currency dropped 1 percent to trade at 6.5382 per dollar and slid 0.4 percent to 8.2479 per euro.

The Australian dollar fell following a report by the Bureau of Statistics that mortgage numbers fell 0.9 percent from a month earlier. The Aussie dropped 1 percent to trade at 87.00 U.S. cents, reducing its advance this week to 0.3 percent. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com