Forex - Dollar broadly higher boosted by Fed speculation

Published 03/30/2011, 05:30 AM
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Investing.com – The U.S. dollar was broadly higher against its major counterparts on Wednesday, boosted by speculation that the Federal Reserve may curtail its bond buying program, while stronger risk appetite boosted demand for riskier assets.

During European morning trade, the greenback was slightly higher against the euro, with EUR/USD slipping 0.11% to hit 1.4098.

On Tuesday, Federal Reserve Bank of Dallas President Richard Fisher said that he did not support further liquidity provision from the U.S. central bank and didn't expect the Fed to launch a third program of asset purchases.

But the greenback was lower against the pound, with GBP/USD climbing 0.35% to hit 1.6061.

Earlier in the day, official data showed that Britain’s services companies grew the most in almost nine years in January as hotels and restaurants recovered after the coldest December in a century.

Elsewhere, the greenback was higher against the yen and the Swiss franc with USD/JPY surging 0.78% to hit 83.13 and USD/CHF rising 0.25% to hit 0.9222.

Meanwhile, the greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD shedding 0.23% to hit 0.9720, AUD/USD edging up 0.08% to hit 1.0299 and NZD/USD gaining 0.25% to hit 0.7581.

Earlier Wednesday, government data showing that New Zealand home-building approvals dropped to a two-year low in February, but it was not possible to say how much of the fall was due to the February 22 earthquake that devastated Christchurch.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.12%.

Later in the day, the U.S. was to publish a report on private sector employment by payroll processing firm ADP.

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