This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Dollar Rises As Fed Expresses Doubt On Stimulus

NEW YORK (AP) â¿¿ The dollar rose Wednesday after a report from the Federal Reserve hinted that the central bank may be closer to slowing or ending its efforts to support the economy.

The Fed released minutes from its January meeting disclosing that several policymakers said they were concerned about the risks of the Fed's policy of buying bonds to keep interest rates low. The bond-buying could eventually cause inflation or unsettle financial markets, they said.

If the Fed ended its program, it would likely lead to higher U.S. interest rates and a stronger dollar.

Foreign exchange analyst Kathy Lien of BK Asset Management said the minutes suggest Fed policymakers could end the bond purchases "way before" the unemployment rate falls below the Fed's current target of 6.5 percent.

"While we are not surprised that Fed officials talked about phasing out asset purchases again...we were surprised by how willing they are to look beyond the 7.9 percent unemployment rate," Lien wrote in a client note.

The dollar added to its gains against the euro in the afternoon, up about a cent in late trading. The euro fell to $1.3281 late Wednesday from $1.3389 on Tuesday. The dollar also rose to 93.81 Japanese yen from 93.44 yen.

The British pound deepened its decline. It fell below $1.52 Wednesday for the first time since July 2010 after a report showed that the Bank of England was more concerned about Britain's economy. If the country takes on more economic stimulus measures that result in lower interest rates, the pound could fall further.

In late trading, the pound was worth $1.5240 compared with $1.5423 late Tuesday.

The dollar also gained against the Canadian dollar and Swiss franc.

Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,042.90 -28.32 -0.17%
S&P 500 1,972.29 -5.51 -0.28%
NASDAQ 4,493.39 -12.4620 -0.28%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs