FED CUTS INTEREST RATE TO %.25

The US dollar fell to a 2 month low versus the Euro after the Federal Reserve’s cut interest rates by 75base points to 0.25%. This latest cut makes the American Dollar the lowest yielding currency amongst the major currencies and could possibly touch of more selling.

The Fed also announced it’s commitment to continue buying Mortgage backed securities and long term treasuries. The USD came under severe pressure after the announcement while stocks rallied.  Most importantly, at .25 percent, most big traders and others looking to buy the currency may not find the yield high enough to justify the risk. This latest move downward for the dollar may be a correction resuming after the past few months of incredible dollar strength despire the ecomonimc doomsday scenario playing out in the United States and the markets around the world.

The EURO broke above 1.4190 as the FED cuts interest rates more than predicted.