FX round-up: Dollar up ahead of Fed decision

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Date: Wednesday 30 Apr 2008

LONDON (ShareCast) - The dollar rose against the euro and sterling ahead of the Federal Reserve’s decision on interest rates.

Consensus is overwhelmingly for a rate cut but analysts are expecting this to be the last rate cut for a while. The central bank is expected to cut interest rates a quarter point to 2%.

Analysts will be keen to see the Fed’s statement accompanying its rate decision and its view on key factors such as oil inflation, the job market and consumer confidence.

The New York based Conference Board consumer confidence index dropped to 62.3 in April from 65.9 in March, its lowest level in five years.

Sterling came under pressure on Tuesday following a report showing a sharp drop in mortgage approvals.

Consumers tightened their belts another notch last month as tough credit conditions set in, according to data from the Bank of England.

Another report showed a weaker UK housing market is having a big impact on the retail sales according to a survey from the CBI.

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