Dollar falls on Fed stimulus plan

AP News
Posted: Sep 13, 2012 5:22 PM

NEW YORK (AP) — The dollar fell against other major currencies after the Federal Reserve said Thursday that it will launch another round of bond purchases to help boost the U.S. economy.

The central bank said that it will spend $40 billion a month to buy mortgage-backed securities for as long as it deems necessary.

The Fed already launched two rounds of bond purchases, most recently in August 2010. Those purchases push interest rates lower and can weaken the dollar.

The euro rose to $1.2985 late Thursday from $1.2894 late Wednesday. The euro rose as high as $1.3001 Thursday, its highest point against the dollar since May 9.

Fed Chairman Ben Bernanke said the central bank will keep buying bonds until it sees more jobs, lower unemployment and stronger growth. He made those comments at a news conference after the Fed's announcement.

Stephen Moore

In other trading Thursday, the British pound rose to $1.6154 from $1.6102 late Wednesday.

The dollar fell to 77.45 Japanese yen from 77.87 Japanese yen, to 0.9348 Swiss franc from 0.9376 Swiss franc and to 96.94 Canadian cents from 97.64 Canadian cents.

The U.S. currency also weakened against the Australian and New Zealand dollar, the Norwegian krone, the Hong Kong dollar and the Brazilian real.