US dollar up ahead of Fed minutes

US dollar up ahead of Fed minutes

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The US dollar was up on Tuesday in early-day trade in Europe as traders awaited the release of the minutes from the most recent meeting of the US Federal Reserve. The minutes from the January 31 meeting, Alan Greenspan’s last as Fed chairman, are expected to support at least two or three more interest rate hikes. Some analysts, however, warned that the advances in anticipation of the minutes could lead to declines once the minutes actually are released.

At any rate, the greenback was up to $1.1906 in relation to the euro and to ¥118.86 against the Japanese yen. The dollar was nearly unchanged in relation to sterling, trading at $1.7443.

Meanwhile, the New Zealand dollar traded at a 16-month low of $0.6635 in relation to the US dollar on rumors that Japanese banks were being told not to sell kiwi-denominated bonds because of recent declines in the New Zealand currency as well as that hedge funds that had bought New Zealand bonds were now beginning to sell.

The Japanese yen was down on the day, as well, falling to ¥141.51 in relation to the euro and to ¥207.28 versus sterling.

The Swiss franc, however, was up to SFr1.5585 in relation to the euro as speculation came that it could rise as confirmed cases of bird flu increased in Europe.