FX round-up: Dollar falls as Fed reiterates rate stance

Date: Wednesday 17 Mar 2010

The dollar fell to a five week low against the euro on Tuesday as the Federal Reserve maintained its tone on keeping interest rates close to zero for an extended period.

The dollar index, which measures the US currency against a basket of six others, fell 0.5% to 79.665.

The euro was boosted by news that Standard & Poor's no longer has Greece’s credit rating under review and that European finance ministers would help Greece if the country needed it.

The euro bounced to $1.3779 from $1.3674 the previous session as risk appetite returned to the table although details of the EU finance ministers’ plans are yet to be revealed.

The greenback eased against the yen to 90.31 yen from 90.52 as the Bank of Japan’s two-day policy board meeting comes to an end on Wednesday.

Sterling recovered from a weak start to the session to rise 1.4% to $1.5259.

Broad gains underpinned by robust UK housing data while the latest opinion poll showed a majority government would win the general election, easing recent concern about a hung parliament.

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