New York Fed President William Dudley's less hawkish stance spurred selling of the greenback Friday. The dollar fell below 108 yen. Fred Katayama reports.
The U.S. dollar extending its slide. The greenback dropped to its lowest level in more than 2-and-a-half years Friday against a basket of currencies. Pressuring the dollar: a less hawkish stance from the president of the New York Fed. In his speech Thursday, William Dudley did not repeat his assertion three weeks ago that he expects to raise interest rates once more this year. That pushed Treasury yields lower. That in turn reduced demand for the dollar. The greenback fell below 108 against the Japanese yen to a roughly 10-month low. It also slipped against the euro. Managing partner Kevin Kelly of Kelly & Co. SOUNDBITE: KEVIN KELLY, MANAGING PARTNERS, KELLY & CO., (ENGLISH) SAYING: "There were a lot of bulls on the dollar hoping we were going to see some price action taking it higher especially with the ECB yesterday. But we saw the ECB reaffirm yesterday that they could probably have the strongest growth in the area in several years. You're starting to see a giant pickup." Amid weak inflation readings and dovish comments from Fed policymakers, traders have lowered their expectations for a rate hike by the Federal Reserve in December.