Aug 4, 2010
The dollar has fallen to multi-month lows against the world’s major currencies as investors bet that evidence of a faltering US recovery will lead to further monetary easing by the Federal Reserve.
Currency traders said expectations of looser US monetary policy raised the prospect of a return of the so-called dollar “carry trade”, in which investors take advantage of low US interest rates to invest in higher-yielding currencies.
The yen approached its highest in 15 years against the dollar, trading at Y85.66, while the euro rose to $1.3261, a three-month high. Sterling hit a fresh six-month high of $1.5968.
“The carry trade could become very fashionable again,” said Martin Wiedmann, global head of foreign exchange sales at Credit Suisse.
This article was posted: Wednesday, August 4, 2010 at 3:26 am