The dollar rose to a two-week high
against the yen after 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 traded near a two-week
high versus the euro as Paulson said he expects Congress to approve a
rescue plan for Fannie Mae and Freddie Mac.
The U.S. currency
strengthened yesterday as Paulson said he's confident that lawmakers will pass
a bill to provide funding for Fannie Mae and Freddie Mac, the largest sources
of U.S.
mortgage financing. He reiterated that a strong dollar is ``really very
important.''
Futures traded on the Chicago Board of Trade showed yesterday a 49% chance
the Fed will increase its 2% target rate for overnight lending between banks by
at least a quarter-percentage point by Sept. 16, up from 23% odds a week
earlier. Policy makers next meet Aug. 5.
EUR/USD failed to break
above $1.5800 before sliding to $1.5740.
GBP/USD consolidated within
the $1.9900/40 range.
USD/JPY rose from Y107.15 to
Y107.80.
In Europe main attention will be on MPC minutes.
At 11:00 GMT Canada will release its inflation data.
There are no key economic data from US today, except weekly crude oil inventories at 14:35 GMT and Beige Book at 18:00 GMT.
NZRB will announce its rate decision at 21:00 GMT with rate currently at 8.25%.