Dollar holds its breath as market awaits Fed policy decision

Published by
Reuters UK

By Hannah Lang WASHINGTON (Reuters) – The dollar pared earlier losses and sterling fell on Tuesday as traders reckoned banking stress could keep the Federal Reserve and the Bank of England from hiking interest rates much further, or at all, later in the week. Investors’ focus has moved to a slew of central bank meetings due this week after days of volatility in markets caused by worries over the stability of the global banking sector. The dollar index fell 0.058% to 103.270, while sterling edged 0.59% lower to $1.2204. Markets are pricing in an 85% chance of a 25-basis-point rate hike when the…

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