Dollar Stays Near Yearly Highs Ahead Of Fed

Washington (Sept 15)  The dollar was little changed for a third day in a row Monday, as traders looked ahead to the Federal Reserve's monetary policy announcement later in the week.

On Wednesday, the Fed is widely expected to announce a further reduction in the pace of its asset purchases, although traders are likely to pay closer attention for clues on the outlook for interest rates.

The dollar has rallied this summer amid mounting speculation that the Fed may signal that it plans to begin raising rates sooner than previously anticipated.

Gains have been less pronounced over the past week, however, with an upcoming referendum on Scottish independence from the  UK  keeping traders from placing aggressive bets.

The dollar was stuck at a 10-month peak of  USD1.62  versus the sterling, a 14-month peak of  USD1.29  versus the euro and a 6-year high above  Y107  against the slumping yen.

In economic news, the Federal Reserve released a report on Monday showing that US industrial production unexpectedly decreased in the month of August. The report said industrial production edged down by 0.1% in August.

Business activity in the  New York  manufacturing sector has expanded at a robust pace in the month of September, according to a report released by the Federal Reserve Bank of  New York  on Monday, with the index of activity in the sector jumping to its highest level in almost five years.

Source: AllianceNews