Dollar Gets Marching Orders as Fed Extends Currency Swap Lines

© Reuters.

By Yasin Ebrahim – The dollar moved deeper into red on Wednesday as the Federal Reserve left interest rates unchanged and extended its temporary dollar liquidity swap lines.

The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell 0.50% to 93.18.

The Fed kept its benchmark rate within a 0%-to-0.25% range and pledged to keep rates near zero “until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.” 

In a blow to hopes of recovery in the dollar, the Fed said it would extend its U.S. dollar liquidity swap lines and temporary repo operations through March 31, 2021. 

The central bank first rolled out the currency stimulus measures when the Covid-19 pandemic struck in March, amid concerns about strains in global dollar funding markets.

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