February 18, 2010

Euro Plunges to 9-month Low as Fed Hikes Discount Rate

The U.S. Dollar is mounting a strong rally late in the trading session following news that the Fed is set to hike the discount rate by 25 basis points to 75 basis points. While not
actually beginning a tighter monetary policy, a hike in the borrowing rate charged to member banks is a sign that the Fed is getting ready to begin removing stimulus and raising other key interest
rates. The Dollar is rallying because the …