February 13, 2007 > Dollar rises against most currencies
Dollar rises against most currencies
By J.W. Elphinstone
NEW YORK (AP), Feb 09 _ The dollar rose against most major currencies Friday as investors positioned themselves ahead of a Group of Seven meeting of finance ministers.
The 13-nation euro bought $1.3006 in afternoon New York trading, down from $1.3038 in New York late Thursday.
The British pound dipped to $1.9503 from $1.9580. The Bank of England's decision Thursday to keep interest rates unchanged at 5.25 percent continues to weigh on the currency. At its previous meeting, the central bank surprised analysts with a quarter point hike.
The dollar rose to 121.64 yen from 121.05 yen on expectations that weakness of the Japanese currency would not be a main focus at the G-7 meeting in Essen, Germany. The meeting ends Saturday.
A wider examination of foreign exchange rates and their effect on economies appeared more likely.
Hawkish statements from a Federal Reserve official on Friday had little effect on the dollar, which made most of its gains during European trading.
Federal Reserve Bank of Dallas President Richard Fisher said Friday that the Fed would raise interest rates again if inflation doesn't moderate, even though he's ``pleased with the current direction of inflationary impulses,'' according to a Dow Jones report. Fisher was speaking at a local event in Dallas.
``There wasn't a lot of reaction to the statements from the Fed officials because the markets are already pricing in a possible hike,'' said David Gilmore, a partner at Foreign Exchange Analytics in Essex, Connecticut. ``Everything Fisher said was pretty much in the most recent Fed statement.''
Last week, the central bank left rates unchanged at 5.25 percent for the fifth straight time. While the accompanying Fed statement was more moderate than what analysts had expected, it left the door open for future rate increases.
Higher interest rates, a weapon against inflation, support a currency by making some assets denominated in that currency more attractive to investors.
In other New York trading, the dollar bought 1.2479 Swiss francs, up from 1.2461 late Thursday. The dollar weakened against the Canadian dollar, falling to 1.1720 Canadian dollars from 1.1824, after a strong jobs report for January came out of Canada, Gilmore said.