Array

By Staff
|
Google Oneindia News

TOKYO, June 8 (Reuters) The dollar held near a one-month high against the yen on Thursday after another round of comments from a top Federal Reserve official cemented expectations that U.S.

interest rates will rise again later this month.

Atlanta Fed President Jack Guynn said the central bank would not let its guard down when it comes to containing price pressures, echoing Fed Chairman Ben Bernanke's remarks earlier in the week that the Fed needed to be vigilant to keep inflation under control.

''The dollar is supported on U.S. rate hike hopes,'' said Hideaki Inoue, forex manager at Mitsubishi UFJ Trust and Banking.

''But with a June hike now nearly priced in, some people doubt if the dollar can rise further.'' U.S. interest rate futures have priced in around an 80 percent chance of the Fed raising rates to 5.25 percent from 5.00 percent at its June 28-29 policy meeting.

In early Tokyo trade, the dollar dipped to 113.45 yen from around 113.55 yen in late U.S. trade, in sight of a one-month high of 113.69 yen hit on electronic trading platform EBS on Wednesday.

The euro edged up to $1.2795 and was little changed at 145.25 yen.

The market is now looking to the European Central Bank's policy meeting later in the day. The ECB is widely expected to raise interest rates by a quarter percentage point to 2.75 percent.

Speculation is rife that the ECB could raise rates to 3 percent, or that the bank's president, Jean-Claude Trichet, may indicate it will boost rates to that level next month.

Elsewhere, the New Zealand dollar rose 0.25 percent to around $0.6300 per U.S. dollar after the Reserve Bank of New Zealand dashed speculation that the central bank would cut rates some time later in the year to shore up the economy.

The RBNZ held rates at 7.25 percent on Thursday, as expected.

REUTERS SK VC0624

For Daily Alerts
Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X
X