While many of the consequences of stimulating economic growth through currency devaluation and cuts in interest rates are known and intended, some are not. In the case of Japan’s lost decade, for example, a depressed currency and low interest rates led to carry trading.
The Conference Board’s index decreased to 86 this month, weaker than the most pessimistic forecast in a Bloomberg survey of economists, from an August reading of 93.4 that was the strongest since October 2007, the New York-based private research group said today.
Oil rallied further after the leaked Fed story. Apparently the Fed did not want the market thinking that rates were going up anytime soon so they dropped a dime to their buddy Jon Hilsenrath at the Wall Street Journal.
Australia’s dollar fell below 90 U.S. cents for the first time since March, and Sweden’s krona declined after elections as prospects for U.S. interest-rate increases next year boosted the greenback’s allure.