Stocks were mostly lower on Monday after a report on November industrial prodution showed a decline in the sector for the third time in the last four months. Meanwhile, the dollar was weakening against a basket of trading partners ahead of the Fed's Tuesday rate decision.
November's 0.6% decline in production left the economy working at about 75% of capacity. Production would have been worse because rebounds after the Boeing strike and Gulf hurricanes added almost 1 percentage point to the change in industrial production.
"The Fed is basically printing money to buy various credit instruments in order to bring interest rates down," said Matthew Carniol, chief currency strategist at TheLFB-forex.com. "If we see the dollar depreciate against the euro, pound and Australian dollar on days when stocks decline it's a sign that a weak dollar trend, which looks to be in the early stage now, will take hold. Gold works the same way; if it appreciates when stocks fall the bull run is on."
In recent trade, the DOW was moving lower by 0.75%. The broader S&P 500 was lower by 1.04% and the NASDAQ 1.78%. The dollar was lower by 2.06% against the euro, 0.56% to the yen, 2.2% on the pound and 0.71% against Australia's dollar.
Crude oil for January delivery was recently trading down 61 cents while gold for February delivery was moving higher by $21.40.