US Dollar Index Plummets After Bernanke Speech

Markets are up nicely heading into the close on Monday. The Dow Jones is up just over 150 points, while the S&P 500 has risen to 1414. Earlier this morning, the Federal Reserve Chairman Ben Bernanke gave a speech in which he outlined how the Fed could continue to support the jobs market in the US. Bernanke stated that recent job gains may be somewhat questionable, and the pace of job gains could fade in coming quarters. Given this, Bernanke stated that there was still room for further easing. Although he did not explicitly mention any additional programs, the vague hinting may have been interpreted by the market as a subtle nod to a future quantitative easing program. In 2010, Bernanke made similar statements at his speech in Jackson Hole, Wyoming. A few months later, the Fed announced the second round of quantitative easing. If the Fed does intend to go ahead with further easing, it may be likely that such easing will take place in the near-term rather than far into the future. Once July passes, any movement by the Fed could be seen as election rigging. At any rate, Bernanke's speech lead to a notable decline in the value of the US dollar, as the index dropped just over 0.50%. Gold gained on the session.