The Federal Reserve is likely to maintain monetary stimulus, Samarjit Shankar, a Boston-based managing director and senior currency strategist at the Bank of New York Mellon Corp., said in an interview in Singapore.
The euro is under pressure as sovereign-wealth funds and central banks move reserves back into dollars or diversify into other currencies, Samarjit Shankar, a Boston-based managing director for the foreign-exchange group at Bank of New York Mellon Corp., said at a round-table with reporters in Tokyo.
The yen weakened for a second day against the dollar amid speculation the Federal Reserve will reduce monetary stimulus while the Bank of Japan maintains its bond-buying program, which tends to debase the currency.
Foreign-exchange traders are putting their faith in Jean-Claude Trichet, betting the European Central Bank President will save the euro from a collapse predicted by everyone from George Soros to Paul Volcker.
Investors boosted bearish bets on the dollar to the highest level in more than two months on concern the political wrangling in Washington on raising the U.S. debt limit will erode the value of the world’s reserve currency.