Fed announcement brings gains to USD

The US dollar gained on the euro and the yen after the US Federal Reserve announced that it will lend up to $200 billion in Treasuries to banks in exchange for mortgage-backed securities at the same time that central banks in Europe and Canada will inject up to $45 billion into their banking systems, all in hopes of raising lending and avoiding a US recession.

At just before noon in New York, the dollar traded at $1.5323 to the euro while it was at $2.0038 in relation to the pound.

The yen declined after the announcement as investors regained their appetite for risky investments, sending the yen to ¥102.9650 to the dollar while it traded at ¥157.7681 to the euro and at ¥206.3213 to the pound.

At the same time, the South African rand saw gains as investors bought the high-yielding currency, which traded at R7.8735 to the dollar and at R12.062 to the euro in midday trade in New York.

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