The US Dollar on the back foot!

US Fed chairman Ben Bernanke has signalled that dollar interest rates will be cut further. He has told the Senate banking committee in Washington that his central bank would "act in a timely manner as needed to support growth and to provide adequate insurance against downside risk". His comments have raised expectations that the next meeting of the Fed's open market committee on March 18 will now its key rate by another 50 basis points to 2.5 pc.
Mr Bernanke painted a largely negative view of the US economy's prospects for the immediate future. He said that what he called the "baseline outlook" was for "sluggish growth", and that this would only be followed by an improvement later in the year. Bernanke warned that that conditions had worsened in recent weeks and that risks to economic growth were significant.
He spoke of "possibilities that the housing market or the labour market may deteriorate to an extent beyond that currently anticipated, or that credit conditions may tighten substantially further". He appeared confident, however, that inflation would remain under control.