Treasury - Daily Forex for day 13.06.2006

The dollar remained well-supported overall yesterday, firming to a one-month high against the euro on growing expectations that the Federal Reserve will continue to raise interest rates. Generally hawkish remarks from Fed representatives made the market believe that the bank will increase rates by 25 basis points for the 17th consecutive time to 5.25% later this month. The dollar extended its gains to more than 4 cents from a one-year high of $1.2979 per euro touched a week ago.

Weaker sentiment in the region knocked the domestic currency lower against the euro on Monday. However, the crown ignored a report showing industrial output grew by just 3.6% in April, much less than a 10.5% expected by the market.