Record Low Interest Rates in U.S. Pressures Dollar
The U.S. Dollar lost ground against all major currencies as record low U.S. interest rates encouraged the selling of the Dollar and the buying of higher yielding assets. Overnight the Dollar firmed until a better than expected U.S. Weekly Initial Claims Report helped put in a top and set off a gradual decline throughout the day.
The Dollar was the recipient of additional selling pressure at about the midsession following a better than expected oil inventory report. Firm equity markets throughout the U.S. trading session were additional signs that investors were demanding higher yielding currencies.
Record low interest rates in the U.S. helped boost demand for the higher yielding EUR USD. Euro bulls are beginning to believe that the U.S. may be amongst the slowest nations to move its interest rates higher once the recovery begins.
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