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Dollar rises from eight-month low after Yellen news

Wednesday, 9 Oct 2013 | 4:01 PM ET
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The dollar rose on Wednesday from an eight-month low against major currencies as news that Federal Reserve Vice Chair Janet Yellen will be nominated as the next chief of the U.S. central bank removed some uncertainty in markets.

Yellen is seen as a dove, which will boost expectations that the Fed will continue its asset-buying program, seen as dollar negative. However, the news brought some relief to investors who have been on edge because of the budget deadlock in Washington.

President Barack Obama said he would not hold talks on ways to end the fiscal impasse while under threat from conservative Republicans but agreed to discuss anything, including his healthcare plan, if they restore government funding and raise the debt limit.

The dollar index, which measures the greenback versus a basket of six currencies, rose 0.6 percent to 80.36, edging away from the 79.627 trough hit last Thursday, a low not seen since early February.

The euro fell 0.4 percent to $1.3522. Against the yen, the dollar rose 0.5 percent to 97.33 yen, moving away from a two-month low of 96.55 touched on Tuesday.

News of Yellen's nomination fueled risk sentiment and pressured traditional safe-haven currencies like the Swiss franc. The dollar rose 0.7 percent to 0.9102 Swiss franc.

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