With the value of the U.S. Dollar weakening and Asian stocks rising, it seems that the Fed will be buying as much as $65 billion in Treasuries a month. Hyundai Motor Co, BHP Billiton Ltd, and Jiangxi Coppor Co are among those with considerable stock increases. The Yen reached a fifteen year high against the dollar this past week, while the increasing supply of dollars in the system will increase demand for tangible assets. The Fed thinks that by increasing the supply of dollars in the system it will lower the external value of the dollar. This will also hopefully increase the demand for U.S. exports with the exchange rate being in favor of those with higher values against the dollar. This also puts pressure on China, for they want the Chinese Yuan to rise during the weakened state of the dollar to improve their economic position.
Submitted By:
Laura Lubuguin
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