USD/JPY Remains Above 108 Before Fed Interest-Rate Decision

The dollar held a three-day decline as signs of an uneven U.S. economic recovery caused investors to adjust their outlooks for interest rates next year before the Federal Reserve sets monetary policy today.

The U.S. currency was near a one-week low versus a basket of major counterparts after data yesterday showed orders for durable goods unexpectedly declined. The Fed said in September that it would conclude quantitative easing this month if the economy keeps improving. Traders have pushed back bets on when the Federal Open Market Committee will raise interest rates. South Korea’s won rose to a one-month high.

“QE is coming to an end, but the economic outlook hasn’t changed, so there probably won’t be a change in the Fed’s statement,” said Masakazu Sato, a Tokyo-based currency adviser at Gaitame Online Co. “That’s a reason to sell the dollar.”

Bloomberg

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