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17 Oct 2013
USD continues to slide as Fed concerns take over
FXstreet.com (London) - With the bitter debt ceiling argument kicked into early next year, dollar has come under pressure with it now increasingly likely that any tapering of the Fed’s asset purchase programme will be pushed into 2014.
EUR/USD has climbed 0.97 percent to USD1.3668 while GBP/USD has climbed 1.15 percent to USD1.6138, spurred on by robust UK retail figures released this morning by the Office for National Statistics.
The dollar took a hit in September, when the Fed announced that economic recovery remained too fragile to taper the central bank’s monthly USD85bn asset purchase programme. Although there was some speculation of a possible small October taper, the government shutdown ruled this out.
Yesterday Congress was able to pass a bill at the eleventh hour to extend the debt ceiling until 7 February. But, though the Treasury could stretch the US coffers a little beyond this date, it still could put any tapering on ice until after the Fed’s March 2014 meeting. Additionally, the estimated 0.6 percent drag on growth caused by the 16-day shutdown will have done little to strengthen Fed faith in the economy’s ability to stand on its own two feet.
EUR/USD has climbed 0.97 percent to USD1.3668 while GBP/USD has climbed 1.15 percent to USD1.6138, spurred on by robust UK retail figures released this morning by the Office for National Statistics.
The dollar took a hit in September, when the Fed announced that economic recovery remained too fragile to taper the central bank’s monthly USD85bn asset purchase programme. Although there was some speculation of a possible small October taper, the government shutdown ruled this out.
Yesterday Congress was able to pass a bill at the eleventh hour to extend the debt ceiling until 7 February. But, though the Treasury could stretch the US coffers a little beyond this date, it still could put any tapering on ice until after the Fed’s March 2014 meeting. Additionally, the estimated 0.6 percent drag on growth caused by the 16-day shutdown will have done little to strengthen Fed faith in the economy’s ability to stand on its own two feet.