The U.S. Dollar weakened broadly today as foreign exchange dealers took profit they have made during the recent gains, ahead of major interest rate decisions from the Euro zone and the U.K. The Bank of England and the European Central Bank are expected to keep interest rates unchanged at 5% and 4.25% respectively. Investors will scrutinize Jean-Claude Trichet’s comments after the meeting to find clues on policy directions for the coming months.
The U.S. Dollar was boosted recently due to an almost $30 drop in oil prices, rebounding global stocks, the growth-supportive tone of officials at the Federal Reserve Bank and cautious optimism about the outlook of the financial sector in the United States.
On August 7, 2008 at 07:55 a.m. GMT, the Euro traded up by 0.3% against the U.S. Dollar to $1.5465, having dropped slightly below $1.54 in overnight trading in Asia. According to analysts, large central banks in Asia bought a large chunk of the Euro. Regarding the Japanese Yen, the U.S. Dollar slipped to 109.40 Yen, following a high of 109.89 Japanese Yen from the previous day.