KUALA LUMPUR, Nov 18 (Bernama) -- The ringgit closed slightly lower against the US dollar today, dealers said.

They said the market was nervous on talks that Indonesia's central bank may restrict foreign ownership of short-term debts.

However, one of the dealers said the rupiah later regained its strength as fear of immediate capital curbs eased.

On the local front, the ringgit was traded within a range of between 3.3620 and 3.3770 to the US dollar throughout the day.

The scheduled listing of Maxis' initial public offering tomorrow provided support for the local currency, according to the dealers.

At 5.02pm, the ringgit was traded lower at 3.3650/3700 against the US dollar compared with yesterday's close of 3.3630/3680.

The local unit ended the day mixed against other major currencies.

LONDON, Nov 18 (Reuters) - The dollar eased back on Wednesday from its biggest rise in three weeks the previous session, as traders awaited U.S. inflation data and minutes from the Bank of England's November meeting for further direction.

The dollar had rallied on Tuesday on the back of rare comments on the currency by U.S. Federal Reserve Chairman Ben Bernanke [ID:nLH705993], comments later echoed by other Fed officials and European Central Bank President Jean-Claude Trichet.

That pushed the euro well below $1.50, but most dealers say the dollar's gradual, longer-term decline is still intact.

Although the Fed may be in the very early stages of withdrawing its huge stimulus measures -- it said on Tuesday it will pare back its the discount window borrowing facility -- it is still nowhere near raising interest rates.

U.S. inflation data for October and BoE minutes of its November policy meeting, which will shed light on how unanimous or otherwise policymakers' vote to extend quantitative easing was, could give an otherwise quiet market direction.

"The Fed's relatively sanguine view on the dollar (although acknowledgement that it is an input into their monetary policy decision makings), coupled with the belief that asset prices are not forming another bubble, should provide a green light for recent trends to continue," said Lauren Rosborough, senior currency strategist at Westpac in London.

LONDON (Dow Jones)--Gloomy global sentiment prevailed, helping the dollar to make gains against most other majors in Europe Thursday.

Stronger than expected employment data from Australia did boost risk appetite at one stage earlier in the day but the move was brief and investors soon lost interest in high-yielders again, with even the Australian dollar turning back down.

The absence of any major economic data later in the day could well leave the currency market at the mercy of charts. Currency strategists at UniCredit suggested that this could help the dollar a little more for now, especially given the difficulty ...

Thursday, during early Asian deals US currency lost ground against its main rivals as gains in Asian stocks boosted investors to turn toward higher-yielding assets.

Asian shares edged up today as investors continued to favor riskier assets on further signs that the global economy is picking up, while a weak dollar sent gold to another record high.

Asian stocks were also upheld by gains on Wall Street where the Dow Jones index hit a fresh 13-month high, helped by an upbeat revenue forecast from luxury homebuilder Toll Brothers Inc.

Against the European currency, the US dollar edged down during early Asian deals on Thursday. At 7:35 pm ET, the dollar touched a low of 1.5017 against the euro, compared to 1.4988 hit late New York Wednesday. The next downside target level for the dollar is seen around 1.506.

The greenback that closed Wednesday's North American session at 1.6577 against the British pound declined to 1.6628 during Thursday's early Asian trading. If the dollar falls further, 1.693 is seen as the next target level. Cable is currently trading at 1.6607

With India purchasing of 200 tonnes of gold from the IMF for US$ 6.7 billion last week — a far cry from the 67 tonnes of gold that India had to humiliatingly pledge in 1991 to stave off an imminent forex crisis — the debate on the need to diversify the forex reserves of the surplus countries has gathered fresh momentum.

Some developing countries have argued that the pain of structural adjustments in their economies consequent to the global financial meltdown has been felt more by countries other than the US because, unlike others, the US can pay for its massive imports in its own domestic currency. This is facilitated by the pre-eminent role of the dollar as a global currency that is held as reserves by countries with surplus trade balances.

China has been known to be actively diversifying away from the dollar over the last few months by investing in strategic holdings of non-ferrous metals and oil wells abroad but with nearly $2 trillion in foreign currency reserves, it has not much of an option but to participate in the process of adjustment in the global balance of payments in order to ensure the safety of its massive financial claims on the rest of the World.

TOKYO, Nov 10 (Reuters) - The dollar hovered just above a 15-month low against a basket of currencies on Tuesday as investors looked to return to leveraged carry trades, while sterling tumbled after a warning on Britain's credit rating.

Fitch Ratings said that of the four major economies with AAA status, the UK was the most at risk, sending the pound down sharply to shed as much as 1 percent on the day against the dollar before it recovered half a cent from the lows. [ID:nT286946]

David Riley, co-head of global sovereign ratings at Fitch, said if there was another significant fiscal stimulus package in Britain its rating would be at risk.

The pound slipped as far as $1.6600 GBP=D4 from above $1.6750 before edging back to $1.6650 and fell more than 0.5 percent on the day to beyond 90.00 pence per euro EURGBP=D4, before paring lossees to 89.93 pence.

"It reminded the market about the UK's fiscal issues and prompted investors to take profits in a recent sharp rise in the pound, which had risen towards the year's high," said Ayako Sera, a market strategist at Sumitomo Trust & Banking.

An index of the dollar's performance against six major currencies edged up 0.1 percent to 75.130 .DXY, having dropped about 1 percent the previous day to as low as 74.93, its weakest since August 2008. It was the biggest one-day fall since late July.

Expectations that U.S. interest rates are likely to stay near zero for a while are encouraging investors to use the dollar to fund carry trades in higher-yielding assets.

"With relatively solid stocks and higher commodity prices, and major events out of the way, market sentiment has shown a sense of relief," said Mitsuru Sahara, chief manager of currency derivatives trading at Bank of Tokyo-Mitsubishi UFJ.

Despite a decline on Friday, the Euro ended the week 0.79% higher against the Dollar. EUR/USD finished Friday trading in a range between 1.4830 and 1.4850. The Dollar failed to confirm a break below 1.4700 and on Wednesday the Euro rallied after the FED decided to leaves rates unchanged but on Friday was unable to hold above 1.4900.

The rally of the Euro against the Dollar eased in the last two weeks as EUR/USD failed to reach levels above 1.5060. Current environment is not very optimistic about the economic recovery, helping the Dollar that works as a refuge for investors.

The dollar came under renewed pressure this week as a series of policy decisions from the world’s leading central banks boosted investor confidence over the prospects for the global economy.

Risk appetite was lifted after the Federal Reserve’s meeting on Wednesday as the central bank maintained its commitment to keep US interest rates at ultra-low levels for an “extended period”.

Most investors agree that it is out there. What is less clear is how big it is, or how worried investors should be about it.

The “it” in question is the dollar carry trade. This is an investment strategy that has recently been extremely profitable and as a result has become increasingly popular.

U.S. Dollar Trading (USD) was on the back foot as stocks rallied around the world and the Federal Reserve left rates at 0.25% and stating that rates would remain low for an extended period of time. ADP October Employment Report was -203k vs. -188k previously. Also released, ISM Services forecast at 50.6 vs. 51.6 forecast. In US Stocks, DJIA +30 points closing at 9802, S&P +1 points closing at 1046 and NASDAQ -2 points closing at 2055. Looking ahead, Weekly Jobless Claims are forecast at 523k vs. 530k previously.

The Euro (EUR) rallied for most of the day on continued strength in commodities and a rebound in stocks. September PPI was as forecast at -0.4%. EUR/JPY enjoyed solid gains although a late sell off in stocks induced profit taking. Overall the EUR/USD traded with a low of 1.4701 and a high of 1.4911 before closing at 1.4880. Looking ahead, ECB rate announcement forecast to remain at 1.0%.

The Japanese Yen (JPY) was very weak as the crosses began to rally and technical's turned against the Yen. USD/JPY struggled to hold above 91 Yen on a mixed response to the FOMC but remains supported on dips. EUR/JPY returned to the 135 figure. Overall the USDJPY traded with a low of 90.03 and a high of 91.34 before closing the day around 90.80 in the New York session.

The Sterling (GBP) rallied above 1.6500 on improved risk appetite and strong GBP/JPY buying. October PMI Services was 56.9 vs. 55.4 previously. 1.6600 capped the topside but the market is well supported ahead of today's BoE meeting. Overall the GBP/USD traded with a low of 1.6600 and a high of 1.6399 before closing the day at 1.6550 in the New York session. Looking ahead, BoE Rate meeting. Also released, September Industrial Production forecast at 1% vs. -2.5% previously.

The Australian Dollar (AUD) was dented in Asia from poor September Retail Sales of -0.2% vs. +0.4% forecast. The dip below 0.9000 proved short lived and when the market continued to push higher the Aussie rebounded. AUD/JPY enjoyed the Yen weakness combined with the ongoing rally in gold. Overall the AUD/USD traded with a low of 0.8970 and a high of 0.9146 before closing the US session at 0.9105. Looking ahead, September Trade Balance forecast at -2100mln vs. -1524mln previously.

Oil & Gold (XAU) continued to push higher on yesterdays momentum nearing the $1100 level. Overall trading with a low of USD$1079 and high of USD$1098 before ending the New York session at USD$1092 an ounce. Broke above $80 a barrel as the rally accelerated. Crude Oil was up $0.80 ending the New York session at $80.40.

The dollar held steady on Tuesday before the start of the U.S. Federal Reserve's policy-setting meeting, while the Australian dollar fell after its central bank raised rates but took a cautious stance going forward.

Falls in European share prices also supported the dollar, which has a tendency to gain when investors shed risk assets. Movements in the foreign exchange market were further dulled because Tokyo markets were closed for a national holiday.

The dollar fell as stocks gained the previous day after data showed a pick-up in manufacturing activity round the globe, but later lost some ground on concerns about the banking system.

Sterling tumbled against the dollar on Tuesday when details were published of a shake-up of some government-acquired banks.

Shares in Royal Bank of Scotland (RBS.L) fell some 5 percent in early trade after it agreed to sell off some businesses. [ID:nL3540088]

In contrast, Lloyds Banking Group (LLOY.L) stocks rose some 2 percent after it said it would launch a record 13.5 billion pound ($22 billion) rights issue.

The dollar stands at a critical juncture as investors await policy decisions from three of the world’s main central banks this week.

The Federal Reserve delivers its verdict on monetary policy on Wednesday, while the European Central Bank and the Bank of England give their verdicts on Thursday. EDITOR’S CHOICE Blog: Money Supply - Nov-02 Aussie and Kiwi dollars up on growth outlook - Nov-02 Renminbi at heart of trade imbalances - Nov-02 Market Insight: China heads for a Japan-style bubble - Nov-02 IMF refuses to rule out use of capital controls - Nov-02

The decisions come as the rallies in risky assets such as stocks, commodities and higher-yielding currencies look vulnerable. This has stoked haven demand for the dollar, pulling it back from multi-month lows.

Since hitting a 14-month low of $1.5061 against the euro at the start of last week, the dollar has rallied 2 per cent as global stocks have retreated.

Analysts say investors are feeling increasingly uneasy over the sustainability of the global economic recovery as ultra-loose monetary policy accommodation is gradually removed.

“The world is a bit like an alcoholic that’s become too reliant on central bank liquidity,” says Steve Barrow at Standard Bank.

“We might still be many, many months away from the first rate hikes from the likes of the Fed, ECB and the Bank of England, but it seems that the market wants to panic now, rather than wait.”

Some central banks have already moved to withdraw monetary accommodation. Commodity-rich Australia and Norway raised interest rates last month, while India moved to tighten monetary policy by increasing the capital requirements of commercial banks.

But it is the actions of the main central banks, particularly the Fed, that will determine wider trends in the currency market.

Analysts say this week’s Fed meeting is likely to prove key in determining whether the current downward correction in risky assets and the dollar rally extend further.

The euro rose against the dollar on Monday as risk-averse sentiment eased on improved economic data and as stocks pared losses, but markets remained skittish before key central bank events and U.S. jobs data this week.

European stock markets shed losses made at the outset on news that CIT Group Inc ( CIT - news - people ), a U.S. lender to hundreds of thousands of small and medium-sized businesses, filed for bankruptcy on Sunday.

Market sentiment was also buoyed after data confirmed an expansion in euro zone manufacturing activity. Final euro zone manufacturing purchasing managers' index for October rose to 50.7 in October from 49.3 in September - in line with an earlier flash estimate and economists' forecasts.

It was the first time the reading has been above the 50.0 mark that divides growth from contraction since May 2008 and its highest level since April 2008 when it also stood at 50.7.

"Today's data suggest that the recovery in the euro area is starting to gather pace," said Colin Ellis at Daiwa Securities.

The euro rose as high as $1.4796. By 1237 GMT, it was up 0.3 percent at $1.4768.

The single currency also hit the day's high against sterling of 90.37 pence, as the pound was hit, with the government set to finalise plans this week to carve up rescued banks Royal Bank of Scotland ( RBS - news - people ) and Lloyds, triggering selling in their shares.

The UK currency is sensitive to news about the country's struggling banking system given the economy's heavy dependence on its financial sector, and a rise in UK manufacturing PMI data failed to boost the currency.

The dollar recovered on Friday from its declines the previous day on the back of solid U.S. growth figures, while the Swiss franc fell sharply on market jitters of suspected intervention.

Traders said the market was nervous about intervention by or on behalf of the Swiss National Bank to keep the franc's strength in check because the euro had fallen to levels around 1.5080 francs where the SNB had already intervened this year.

The Swiss National Bank declined to comment.

The euro held above a 2-1/2-week low against the dollar after it rose on Thursday, when data showing the U.S. economy grew for the first time in more than a year had raised optimism about the global economic recovery and stoked risk appetite.

European shares failed to add significantly to its rally from the previous day, suggesting that some of the initial euphoria from the U.S. figures may have fizzled, while U.S. stock futures fell 0.4 percent.

Currencies seen as being higher-risk struggled to make headway as stocks posted limited gains, while the yen also erased some of the previous day's falls.

"The market is waiting to see if the rise in risk appetite is durable," said Jeremy Stretch, strategist at Rabobank in London.

"The recovery is continuing, but there are enough question marks to keep the market worried," he said, adding that a comatose job market and the wind down of the "cash for clunkers" scheme raised questions about whether U.S. growth will continue.

Dollar is getting stronger across the board with the exception of the Yen on a big sell-off in equities. GBP/USD fell after the opening bell to 1.6415 (intra-day low). From there rebounded sharply and rose back above 1.6500 but failed to hold and regained the downside.

After finding resistance at 1.6450, Dollar gain momentum and the pair fell to 1.6410 posting a fresh intra-day low. The next support lies at 1.6400 and below at 1.6330.

Michael J. Malpede, analyst at Easy Forex affirms:" The main focus for GBP trade apart from the risk appetite is BOE policy outlook. In light of last week's report of a surprise decline in UK Q3 GDP the BOE may elect to expand its asset purchase plan at next week's policy meeting. The BOE meet on November 5th and are expected to decide whether to extend the current size of the asset purchase plan of £175 bln. The BOE's decision will be crucial to the outlook for the GBP because a number of central banks and governments are preparing to withdraw stimulus."

It’s been a long time since the market has paid attention to Bundesbankers below the level of President Weber. Comments from Board member Sarrazin might get some notice as they go with the grain of the market at the moment and he has recently been in the news for other reason. Sarrazin says he sees no end in sight to the rise of the euro against the dollar and that dollar weakness is needed to correct the US current account deficit, according to our friends at Market News. Sarrazin was recently stripped of some of his duties at the Buba for impolitic remarks about immigrants in Germany. Sarrazin

By Katie Martin Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Renewed fears about a shift out of dollars for large official reserve holders have pushed the ...

See all stories on this topic

Russia has full confidence in the dollar and there is no immediate plans to switch to a new reserve currency, says Russian Finance Minister Alexei Kudrin.

By Gary Stride Of DOW JONES NEWSWIRES LONDON (Dow Jones)--The dollar has clawed itself back from one-week lows against the majors Friday as players trim ...

See all stories on this topic

Dealers note strong buying of cable from the 1.6550 level all the way up through 1.6600 and the pound remains underpinned.The demand seemed to come under duress, traders say. This means the buyer really wanted them cheaper but was forced to pay up to cover his exposure, just like us mere mortals. Institutional investors were strong sellers of EUR/USD in the 1.4160/70 area as well. Gerry is reaching for his LL Bean catalog as we write. the invisible hand is at work!