Dollar falls after Fed rate decision

By Blake Ellis, staff reporter


NEW YORK (CNNMoney.com) -- The dollar fell against major currencies Wednesday after the Federal Reserve kept its interest rate policy unchanged.

What prices are doing: The dollar fell 0.3% against the euro to $1.2311, and slipped 0.8% to ¥89.84 against the Japanese yen.

dollar.png

The pound extended gains, rising 1% versus the dollar to $1.4963 after the U.K. announced its most severe budget cut in decades on Wednesday.

What's moving the market: The Federal Reserve on Wednesday said it would keep its key interest rate target unchanged at between 0.0% and 0.25%.

The rate decision had little impact on currency prices, since interest rates were widely expected to be held near historical lows.

Still, investors will scrutinize the statement for any signs that the central bank plans to raise rates in the near future.

The decision comes on the heels of a new home sales from the Census Bureau that showed the sales fell further than expected to a record low.

Sales were expected to have fallen to a seasonally adjusted annual rate of 430,000 units in May from a 504,000 unit rate in the previous month, according to a consensus of economists surveyed by Briefing.com.

On Tuesday, a report from the National Association of Realtors showed that existing home sales missed expectations, falling 2% to a seasonally adjusted annual unit rate of 5.66 million in May from an upwardly revised rate of 5.79 million in April.

What analysts are saying: The dollar is likely to remain in a narrow range in the coming weeks unless U.S. economic data signals that the economy is improving, said Kevin Chau, a currency analyst at IDEAGlobal.

"In the long term though, it makes sense that the dollar will be stronger given that the problems in Europe are not going to go away," he said. "And if data in the U.S. continues to be weaker, people are going to have to revise their forecasts for U.S. growth and we'll see more of a safe haven flight into the dollar." To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.08%4.25%
15 yr fixed3.17%3.23%
5/1 ARM3.30%3.37%
30 yr refi4.06%4.19%
15 yr refi3.16%3.18%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 17,122.01 15.31 0.09%
Nasdaq 4,569.62 -1.02 -0.02%
S&P 500 2,000.12 0.10 0.00%
Treasuries 2.36 -0.03 -1.25%
Data as of 11:08pm ET
Company Price Change % Change
Bank of America Corp... 16.20 -0.13 -0.80%
Apple Inc 102.13 1.24 1.23%
Facebook Inc 74.63 -1.33 -1.75%
Yahoo! Inc 38.18 0.39 1.03%
Pfizer Inc 29.49 0.28 0.96%
Data as of 4:02pm ET

Sections

Staggering interest from the Chinese in an immigration program has led the U.S. to run out of available visas for the first time ever. More

Former Fed chief Ben Bernanke believes the 2008 financial crisis was the worst in global history, topping even the Great Depression. More

Snapchat has gotten a $20 million funding round from Kleiner Perkins, valuing the company at $10 billion, according to the Wall Street Journal. More

Utah State professor Michael Glauser cycled 4,000 miles this summer, visiting 100 entrepreneurs across the country. Here's a snapshot of how they grew their businesses. More

Five CNNMoney readers share stories about saving that you can learn from: What they would do differently if they had another chance. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.