Wednesday, September 23, 2009 FRANKFURT: The euro traded close to one-year highs against the dollar Wednesday before the Group of 20 summit and a U.S. Federal Reserve decision on interest rates.The 16-nation euro bought $1.4794 in European morning trading, marginally higher than the $1.4792 it bought late Tuesday in New York. The euro had risen as high as $1.4840, a high for the past year, in spot trading over the past 24 hours.The British pound rose to $1.6366 from $1.6352. The dollar also sank against the Japanese currency, declining to 90.90 yen from 91.24 yen.Traders have been ditching the dollar for other currencies, with signals pointing to an economic recovery and the Group of 20 finance officials recently pledging to maintain government spending, low interest rates and increased money supply to shore up the global economy.Those moves should help boost economic activity and liquidity in financial markets, increasing investors' appetite for assets around the world at the expense of the dollar.Investors are looking to this week's summit of G-20 leaders in Pittsburgh this week for more indications on where the economy is headed.Signals also could come from the Fed, which is expected to keep the federal funds rate at a range near zero when it announces its decision Wednesday."On the economy, we expect the Fed to upgrade slightly its current assessment, but remain cautious on the outlook in light of significant weakness in employment and consumer spending," analysts said in a note to clients."If the Fed were to expand any of its asset buying, we would expect ... the U.S. dollar to fall across the board."
Wednesday, September 23, 2009 FRANKFURT: The euro traded close to one-year highs against the dollar Wednesday before the Group of 20 summit and a U.S. Federal Reserve decision on interest rates.The 16-nation euro bought $1.4794 in European morning trading, marginally higher than the $1.4792 it bought late Tuesday in New York. The euro had risen as high as $1.4840, a high for the past year, in spot trading over the past 24 hours.The British pound rose to $1.6366 from $1.6352. The dollar also sank against the Japanese currency, declining to 90.90 yen from 91.24 yen.Traders have been ditching the dollar for other currencies, with signals pointing to an economic recovery and the Group of 20 finance officials recently pledging to maintain government spending, low interest rates and increased money supply to shore up the global economy.Those moves should help boost economic activity and liquidity in financial markets, increasing investors' appetite for assets around the world at the expense of the dollar.Investors are looking to this week's summit of G-20 leaders in Pittsburgh this week for more indications on where the economy is headed.Signals also could come from the Fed, which is expected to keep the federal funds rate at a range near zero when it announces its decision Wednesday."On the economy, we expect the Fed to upgrade slightly its current assessment, but remain cautious on the outlook in light of significant weakness in employment and consumer spending," analysts said in a note to clients."If the Fed were to expand any of its asset buying, we would expect ... the U.S. dollar to fall across the board."
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