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Dollar dips against yen ahead of Fed meeting

business Updated: Nov 04, 2009 10:15 IST

AFP
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The dollar edged down in cautious Asian trade on Wednesday ahead of monetary policy meetings at the US Federal Reserve and other key central banks this week, dealers said.

The greenback slipped to 90.21 yen in Tokyo morning trade from 90.31 late Tuesday in New York. The euro fell to 1.4713 dollars from 1.4728 and to 132.69 yen from 133.19.

"Players are refraining from taking clear positions ahead of the FOMC (Federal Open Market Committee meeting) on Wednesday," said Yosuke Hosokawa, head of forex group at Chuo Mitsui Trust Bank.

"The chances of a change in rates are extremely slim as the US economy is still struggling to recover from abnormal economic conditions," said Hosokawa.

"Market participants will look to see how positively the FOMC assesses the US economy," he added.

The US Federal Reserve is widely expected to hold its key lending rate steady in a range of zero to 0.25 per cent this week. The European Central Bank and Bank of England will announce policy decisions the following day.

Most expect no change in the level of interest rates in Europe, but markets will be watching closely to see what the central banks might have to say about the outlook and the prospect for an eventual tightening of monetary policy.

Traders are also turning their attention to key US jobs figures due Friday.