The dollar rose the
most against the euro
in more than two weeks as Treasury Secretary Henry Paulson voiced support for
the currency and the Federal Reserve Bank of Philadelphia president said interest rates
should be raised.
The greenback extended its gain after breaking
$1.5900 and as crude oil prices fell.
The U.S. currency strengthened today as Paulson said in a speech
that he's ``confident'' that lawmakers will pass the bill to ``boost
confidence'' in Fannie Mae and Freddie Mac, the largest sources of U.S.
mortgage financing. He reiterated that a strong dollar is ``really very
important.'' The dollar touched the
record low earlier this month on concern Fannie and Freddie, which own or guarantee almost half of
the $12 trillion in U.S.
home loans outstanding, may fail to survive the housing slump.
Philadelphia Fed President Charles Plosser said
in a speech today in King of Prussia, Pennsylvania, that the U.S. central bank
should raise interest rates ``sooner rather than later.''
Futures traded on the Chicago Board of Trade
showed a 47% chance the Fed will increase its 2% target rate for overnight
lending between banks by at least a quarter- percentage point by Sept. 16.