Dollar Falls as Fed Makes Emergency Cut in Interest Rates
The dollar fell against the euro after the Federal Reserve made an emergency cut in interest rates for the first time in seven years.The currency’s decline was muted on speculation the 75- basis-point reduction in the target overnight rate will fail to halt a worsening global economic slowdown. The dollar’s drop was also limited as investors seeking the relative safety of government debt bought Treasuries. Global stocks plummeted.
“There’s still a lot of pessimism out there,'’ said Robert Fullem, vice president of U.S. corporate foreign-exchange sales in New York at Bank of Tokyo-Mitsubishi UFJ Ltd. The rate cuts are “definitely negative for the dollar'’ but “didn’t change the longer-term picture'’ for the global economy. Read more from Bloomberg.