The dollar suffered a sharp fall yesterday as concerns over how much longer the Federal Reserve would keep pumping liquidity through the global financial system led investors to sell-off the currency.
The move followed a euro rally after the European Central Bank kept interest rates on hold and raised its forecasts for growth in the eurozone next year despite scaling back its expectations for 2013.
This spurred further dollar selling in the world’s largest financial market as the currency breached technical support levels. The dollar index fell nearly 2 per cent while the US currency dipped 3 per cent against Japan’s yen to move below Y96.
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