U.S. Dollar Rises after Fed Comments on Economy

The dollar rose to the strongest level in almost two weeks against the yen after the Federal Reserve said it sees economic improvement even as it plans to maintain stimulus while it awaits evidence of further gains.

The Bloomberg U.S. Dollar Index touched the highest since Oct. 17, erasing an earlier loss, after policy makers issued a statement following a two-day meeting. The greenback fell earlier amid bets the central bank would keep buying $85 billion of bonds a month under quantitative easing. New Zealand’s dollar rose as the central bank said interest-rate increases are likely next year.

Fed officials “said they’re still seeing improvement in economic activity and labor-market conditions, which is why we saw the dollar rebound,” Eric Viloria, a senior currency strategist at Gain Capital Group LLC in New York, said in a phone interview. “But the trend is still for dollar weakness as they maintain the pace of QE.”

Bloomberg

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