Dollar Drops to Another Record Low Ahead of Fed
The dollar fell to a record low against the euro for the third consecutive session on Tuesday, a day ahead of the outcome of a Federal Reserve meeting at which an interest rate cut is expected.
Dealers seemed intent on heading into the meeting with hefty bets against the greenback, expecting the Fed to signal that additional policy easing might be needed to stave off a U.S. economic recession.
The euro edged up 0.1 percent from late Monday, to a high of $1.4441, according to Reuters data.
The euro has risen around 10 cents since mid August, when a crisis in the U.S. subprime mortgage market began to spread to other areas of the economy.
The dollar index, a gauge of the greenback's value against a basket of major currencies, fell to a low of 76.747.
Against the Swiss franc , the dollar fell to the lowest in 2-1/2 years, at 1.1586 francs.
While the chance of a half-percentage point rate cut by the Fed on Wednesday has evaporated in the last few weeks, the futures market still reflects expectations for about 40 basis points of policy easing by the end of January 2008.