Forex News

The Federal Reserve kept interest rates at current levels, but extended the long-term debt purchasing program, to the tune of $300 Billion. The move helped vault the higher yielding currencies in a display of risk appetite and gave caution to traders who were thinking that all was well in the US economy. While the Fed did say that the situation was much improved, and essentially gave no negative economic comments, the fact that they are extending the bond buying program signals that the US economy is still vulnerable and at risk of turning negative very quickly.In the past few treasury sales, the Federal Reserve has been the primary bidder, essentially printing money in order to accomplish the purchases. The US economy, according to many analysts, is at risk if inflation as a result of the aggressive spending and debt issuance. Year to date, the US debt has increased by $1.27 Trillion in the fastest and most expensive spending spree on record.At 3:00AM GMT, the US Dollar was down .25% to the Euro to 1.4221, down .22% to the British Pound to 1.6507, down .15% to the Canadian Dollar to 1.0895, down .4% to the Australian Dollar to .8361, down .35% to the New Zealand Dollar to .6737 and down .16% to the Swiss Franc to 1.0763.Other news…Norway's central bank held rates at a record low, but opened the door for increased borrowing costs sooner than expected as the economy continued to recover. Chinese stocks sank on Wednesday on fresh worries that this year's equity rally was running ahead of an economic recovery and bank lending was showing signs of cooling.