As reported at 2:52 pm (JST) on March 19, 2009 in Tokyo, the U.S. Dollar climbed higher after suffering its biggest single day plunge in more than 20 years as the Federal Reserve surprised investors by announcing that it would put more money into the financial system by buying long-term Treasuries.  The Fed authorities said it would purchase close to $300 billion long-dated Treasuries during the next 6 months, which makes it the first large-scale purchase of Treasuries since the early 1960s.  In addition, the Fed will also buy mortgage-backed securities and other related agency debt in its attempt to rescue the ailing economy.

The move by the Fed stirred concern that the sharp increase in its balance sheet, which according to recent report has already increased two-fold over the past 6 months, would flood U.S. Dollars into global markets, which would lead to excess supply of the global main reserve currency.

The Euro hit a 2-month high and traded at $1.3536, but it later retreated and fell by 0.1% to $1.3462 from late trading in the

U.S. The U.S Dollar dipped by 0.4% against the Japanese Yen and traded at 95.81 Yen, while the Euro fell by 0.6% against the Japanese Yen and traded at 129.01 Yen. on Wednesday.