You are here
US dollar strengthens as markets await Fed decision
[NEW YORK] The US dollar strengthened on currency exchange markets Tuesday, as anticipation built for next week's meeting of US Federal Reserve policymakers to review interest rate policy.
Toward 2100 GMT, the euro was worth US$1.1217, down from US$1.1234 on Monday. The US dollar stood at 102.59 yen, up from 101.85 and the pound bought US$1.3196, down from US$1.3336.
A divided Federal Reserve is due to convene a two-day meeting beginning next Tuesday, with its dovish and hawkish members disagreeing as to timing and urgency of the central bank's next increase in the federal funds rate.
While higher rates can increase demand for the US dollar, markets have received conflicting signals in recent weeks, with members suggesting both readiness to move and urging forbearance.
Erik Nelson of Wells Fargo said that additional US economic data due in the coming days could help clarify the near-term direction of foreign exchange markets.
"I would expect as we get further in the week and get some data from the US that that should provide the euro with more direction heading into next week's Fed meeting (which) probably will have an effect on the path of the dollar for the next weeks," he said.