Euro hits 4-1/2 month high; dollar index 15-month low

LONDON, March 22 Tue Mar 22, 2011 4:37am EDT

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LONDON, March 22 (Reuters) - The euro rose on Tuesday to its highest against the dollar this year, as the U.S. currency's low -yielding status dragged it to a 15-month low against a basket of currencies.

The euro traded as high as $1.4249 EUR=, its highest in four and a half months, and the dollar index fell to a 15-month low of 75.302 .DXY. Sterling rose to a 14-month high of $1.6353 GBP= as traders bet on another upside surpse from UK inflation data out later Tuesday.

Traders are betting that the U.S. Federal Reserve will lag behind other major central banks in raising inetrest rates, putting the dollar under broad selling pressure.

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