(Bloomberg) — The dollar may rise for a second day against the euro after Federal Reserve Bank of Chicago President Michael Moskow said more interest-rate increases may be needed.
The U.S. currency has gained almost 16 percent versus the euro this year as the interest-rate gap favoring the dollar widened. Traders pared bets on how high the European Central Bank will raise rates after President Jean-Claude Trichet yesterday said he doesn’t expect “a series” of increases.
“Sentiment to buy the euro against the dollar is declining as Moskow made hawkish comments on rates,” said Minoru Shioiri, a Tokyo-based senior manager of Mitsubishi UFJ Securities Co., a unit of Mitsubishi UFJ Financial Group Inc., the world’s biggest lender by assets. “At the same time, Trichet showed a skeptical view on a series of rate hikes” in Europe.
