Dollar Rises Before Fed Meets; Euro Holds Gain on Greek Relief By Chikako Mogi and Kevin Buckland - 27 ม.ค. 2558 09:43:08 The dollar held a gain from yesterday against the yen on easing haven bids and speculation the Federal Reserve will stick to its stance suggesting an interest-rate increase this year. The euro remained stronger after rallying from an 11-year low yesterday amid speculation the victorious Syriza party in Greek elections will pursue its anti-austerity agenda without forcing an exit from the currency bloc. The single currency extended an advance against the yen after rising the most in two months yesterday. Australia’s currency held near the weakest in 5 1/2 years after a private gauge of business confidencestayed near the lowest since July. “The U.S. dollar remains supported, and that will continue for the foreseeable future,” said Robert Rennie, head of currency and commodity strategy in Sydney at Westpac Banking Corp. “That’s being driven by other central banks needing to be much more aggressive.” The dollar bought 118.31 yen at 11:36 a.m. in Tokyo, after climbing 0.6 percent on Monday. The euro advanced 0.1 percent to $1.1244 after yesterday sliding to $1.1098, the lowest level since September 2003. The common currency was little changed at 132.98 yen from Monday when it touched 130.15, the weakest since September 2013. Fed Meeting The Fed will convene a two-day policy meeting later today. Yuki Sakasai, a foreign-exchange strategist at Barclays Plc in New York, said the Fed was likely to repeat its stance from the last meeting. “There may be some positioning ahead of the meeting and push up the dollar slightly against the yen, but the Fed’s basic stance is not going to change.” Policy makers said in a statement after their December meeting that they can be “patient” in their approach to raising rates. The Fed is forecast to leave interest ratesunchanged at this week’s meeting, a Bloomberg survey of economists shows. The chance of a interest-rate increase by policy makers’ October meeting was 53 percent, futures data showed, down from 72 percent at the end of 2014. The Bloomberg Dollar Index, a gauge of the dollar’s performance against is major peers, was little changed at 1,161.88 from the record close of 1,161.42 in New York. The euro remained higher against most of its 16 major peers after Alexis Tsipras’s Syriza party party and the anti-bailout Independent Greeks announced plans for a coalition in Athens to control the 300-seat chamber. Syriza was two seats shy of the 151 needed for an absolute majority in Greece’s parliament, according to the latest results from the Interior Ministry. Even in a fragile coalition, the result hands Tsipras a mandate to confront Greece’s austerity program, imposed in return for pledges of 240 billion euros ($270 billion) in aid since May 2010. No Writedown Finance chiefs from the 19-nation euro area signaled their willingness to do a deal with Tsipras -- so long as the new Greek prime minister drops his demand for a debt writedown. At a meeting in Brussels on Monday, ministers agreed quickly to work with the new government to help keep Greece in the euro, Dutch Finance Minister Jeroen Dijsselbloem said. “The market is treating Syriza’s win as an anti-austerity movement more than an anti-euro movement,” Sireen Harajli, a Mizuho Bank Ltd. strategist in New York, said in a phone interview. “The bigger picture is QE instead of Greece.” The euro has tumbled 4.7 percent this year, the worst performance among 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The yen rose 4.9 percent and the dollar gained 3.3 percent. Business Conditions The Australian dollar slipped 0.1 percent to 79.16 U.S. cents, 0.8 percent away 78.55 touched yesterday which was the weakest since July 2009. National Australia Bank reported its index of business conditions rose one point to 2 in December. Demand for the Australian dollar was also limited amid speculation over the prospects for interest rates, currently at a record low of 2.5 percent, with the Reserve Bank of Australia meeting next week. “We expect the RBA will cut rates down to 2 percent mid-this year in an environment of weak commodity prices and -- let’s face it -- disappointing data,” Rennie at Westpac said. “The NAB business survey is a good case in hand.”
Posted on: Tue, 27 Jan 2015 11:26:30 +0000
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