Prior to Wednesday this week, there were discussions and a possibility that QE3 was on the table. Traders took the news and sent US dollar much lower while commodity currencies, Crude Oil and Gold went much higher. Gold traded at a high of US$ 1,594 thereabouts.
However, on Thursday the Fed Chairman said to the Senate Banking committee that inflation is much higher, the situation is more complex and are still uncertain about the near term developments in the US economy. Before any further discussion of new stimulus, the Feds would like to see if the US economy picks up or not. As such, the Feds are not prepared to take further action at this point.
He added that the US default debt would be devastating for both the US and global economy.
As a result, the US major indices closed lower for the day with the NASDAQ falling 1….