Dollar edges higher as traders await Fed decision

LONDON/SINGAPORE, Jan 25 (Reuters) – The dollar ticked up on Wednesday in subdued trading as investors looked towards the Federal Reserve’s policy decision next week, while the euro traded just below a nine-month high.

The euro was 0.26% lower against the dollar at $1.086, down from the $1.093 level reached on Friday, which was the highest since early May.

Meanwhile, the dollar was down 0.32% against the yen , at 129.74 yen per dollar, having hit an 8-month low of 127.22 on Jan. 16.

Alvin Tan, head of Asia FX strategy at RBC Capital Markets, said markets were quiet due to the Lunar New Year holiday and the looming Fed meeting.

“Much of Asia is still on holiday,” Tan said. “We have the Fed coming up very soon and I think there’s a bit of caution ahead of that.”

A drop in global energy prices and a resulting slowdown in inflation in advanced economies has spurred speculation the Fed and other central banks might soon stop raising interest rates.


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