Dollar Hit Record Low

The dollar extended its loss versus the euro and sterling on expectations that the Fed may cut interest rates again next week. The dollar index slumped to a fresh all-time low at 77.035. The euro approached 1.44 versus the dollar, while the sterling rose to as high as 2.0571.

This week¡¯s economic data, including housing sales, durable goods orders, weekly jobless claims and today¡¯s consumer sentiment index, all showed signs of economic growth slow down. University of Michigan consumer sentiment index fell from 83.4 to 80.9 in October, below the estimate of 82.

It is widely expected that the Fed will lower rates by a quarter-percentage point to 4.00%. Under the pressure of housing slump and rising credit costs, the nation¡¯s economic growth may slow down in the future. The overall sentiment on the dollar is bearish.

Dollar Down Further On Housing Concern

The dollar dropped further against the euro and yen as worse-than-expected reports today raised concern on the nation¡¯s economic growth outlook.

US weekly jobless claims fell slightly from 337k to 331k, worse than the estimate of 320k. Durable goods orders unexpectedly dropped 1.7% in September, far below the forecast of a 1.5% rise. New home sales slid from 795k to 770k in September, raising concern on the housing slump.

The euro approached a record high hit recently at 1.4344 versus the dollar, and the yen strengthened to as low as 113.79 against the dollar. The dollar is under pressure as the Fed is widely expected to lower rates again next week.