Dollar wobbles as Fed tapering expectations pushed back

By Hideyuki Sano

TOKYO (Reuters) - The dollar was mired near an 8-month low against a basket of currencies on Monday on growing expectations the U.S. Federal Reserve will have to delay scaling back its stimulus following a 16-day government shutdown.

The dollar index was little moved in Asian trade around 79.642 .DXY, but not far from a trough of 79.478 touched on Friday, its lowest level since February.

"In the last two months, previous payrolls figures were revised down. The U.S. economy is losing steam and cannot withstand tapering," said Daisuke Uno, chief strategist at Sumitomo Mitsui Bank.

"There will be disappointment at every Fed meeting for the rest of the year, and each time the dollar will weaken," he added.

The Fed has two policy meetings scheduled this year, one on Oct 29-30 and the other on Dec 17-18.

A majority of market players now expect the Fed will begin reducing stimulus next year, though some analysts believe tapering of the bond buying program is still possible in December.