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FX round-up: Dollar falls on Bernanke comments

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Date: Friday 15 Feb 2008

LONDON (ShareCast) - The dollar fell on Thursday after the US Federal Reserve chairman Ben Bernanke suggested that he was open to more cuts in interest rates.

Addressing the Senate Banking Committee, he said the Fed would “act in a timely manner as needed to support growth and to provide adequate insurance against downside risks.

Bernanke acknowledged that consumers still faced the effects of financial volatility, even after recent interest rate cuts.

The news hit the dollar as further cuts in interest rates will lessen the appeal of the currency.

Meanwhile, the Labor Department's weekly figures on unemployment fell 9,000 to 348,000 last week, while data revealed the December trade gap narrowed more than expected.

Sterling was continuing to benefit from comments from the Bank of England on Wednesday that interest rates may not be cut as much as previously expected.

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