The US dollar was hovering near an all-time low against the euro in late afternoon trade in Asia Thursday on speculation that weak US housing data and stable inflation may prompt the Federal Reserve to cut rates again this quarter.
US Commerce Department data showed housing starts and building permits fell to a 14-year low last month, an offshoot of the subprime mortgage crisis. A separate report showed that core inflation, excluding food and energy prices, was steady at 0.2 percent for the fourth month in September.
'The dollar's weakness is a response to the US data releases overnight,' said Thomas Lam, treasury economist at United Overseas Bank. 'The readiness is still there that the Fed will reduce rates by the fourth quarter.'
The Fed may trim rates by a quarter of a percentage point, he said.
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Re: “The US dollar was hovering near an all-time low against the euro in late afternoon trade in Asia Thursday ...”
A “Federal Reserve Note” is not a U.S.A. dollar. In 1973, Public Law 93-110 defined the U.S.A. dollar as having the value of 1/42.2222 fine troy ounces of gold.
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