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Dollar down as investor focus returns to US economy, Fed

The U.S. Capitol Building
Getty Images
The U.S. Capitol Building

The dollar slid against a basket of currencies on Thursday as a deal to end the U.S. debt stalemate in Congress prompted investors to focus on the economic impact of the government shutdown.

Analysts said the two weeks of uncertainty that knocked investor and business confidence would have dented the growth prospects of the world's largest economy.

That would likely keep the Federal Reserve from withdrawing monetary stimulus at least until the beginning of next year. As such, U.S. Treasury yields slipped and dragged the dollar down against most major currencies, including the yen.

Adding to the dollar's woes was Chinese rating agency Dagong, which downgraded the United States to A- from A and maintained its negative outlook.

Though not followed widely outside China, moves from other ratings agencies will concern investors.

The dollar index was down 0.9 percent at 79.718, well off a one-month high of 80.754 struck on Wednesday. Against the yen, the dollar lost 1 percent to trade at 97.81 yen, pulling back from a three-week high of 99.00 yen set much earlier in the global day.

The dollar's broad losses saw the euro rise 0.9 percent to $1.3659 with a peak of 1.3663, its highest since early February.

For more currencies, click here.

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