NW18: World FX: Dlr soft big US rate cut seen; dlr index at new low
NewsWire18, Tuesday, Mar 18
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	At 10:50AM	High	Low	Previous
GBP/USD	2.0026	2.0046	1.9967	1.9969
EUR/USD	1.5773	1.5794	1.5724	1.5742
NZD/USD	0.8040	0.8046	0.7978	0.8006
AUD/USD	0.9223	0.9227	0.9163	0.9202
USD/JPY	97.160	97.330	96.830	97.100
USD/INR	40.650	40.685	40.620	40.730
USD/KRW	1022.5	1025.1	978.02	987.99
USD/CAD	0.9926	0.9968	0.9924	0.9946
EUR/INR	64.115	64.200	63.544	63.597

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World FX: Dollar soft big US rate cut seen; dollar index at new low
MUMBAI--10:50AM--Strong expectations of a 100-basis-point rate cut by the Federal Reserve at its meeting late today to decide on interest rates prompted banks to sell the greenback.
The rate cut is likely to be part of the Fed's efforts to revive a flagging U.S. economy.
Such expectations have emerged since the Federal Reserve announced a 25-basis-point emergency cut on the discount rate to 3.25% Sunday, to boost liquidity and provide aid to banks hit by credit defaults.
Dollar weakened to 1.5773 against the euro compared with 1.5742 Monday. Against the pound sterling, the dollar slipped to 2.0026 today, compared with 1.9969 Monday.
"A rate cut of less than 100 basis points is likely to be greeted with lots of negative sentiment and would be negative for carry-trades and equity markets," said a currency note by Kshitij Consultancy Services.
"The discount rate, which was cut on Sunday, is again likely to cut, in the same magnitude to the Fed Funds rate," the currency note said."
The Federal Reserve will announce its interest rate decision around 11:45PM today.
"Uncertainty about this weeks FOMC outcome has increased as the chances of a 100bps cut has increased substantially over the weekend," said a currency note by ICICI Bank.
The dollar index--an index that measures dollar's movements against six major currencies--fell to its lowest level of 70.79 on Monday and is currently at 71.24. (Prithvi Durai) End

Notes: USD = U.S. dollar, JPY = Japanese yen, KRW = Korean won,
THB = Thailand baht, EUR = euro, GBP = British pound, INR = Indian rupee,
CNY = Chinese yuan, PHP = Philipine peso, AUD = Australian dollar,
NZD = New Zealand dollar, CAD = Canadian dollar, SGD = Singapore dollar,
HKD = Hong Kong dollar, TWD = Taiwanese dollar, MYR = Malaysian ringgit

Edited by Jones Koshy

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