FOREX-Dollar edges higher as traders eye more hawkish Fed
* Traders await Fed statement Wednesday
* U.S. GDP, jobs data also on calendar
* Dollar hits fresh 8-month highs against euro
* U.S. consumer confidence rises in July (Updates prices, adds comments; changes byline, dateline, previous LONDON)
By Sam Forgione
NEW YORK, July 29 (Reuters) - The U.S. dollar hit fresh eight-month highs against the euro on Tuesday and rose slightly against the yen and Swiss franc as traders awaited U.S. economic data and a potentially more hawkish tone from the Federal Reserve.
Analysts said the Fed, which is expected to cut its monthly bond-buying progam by another $10 billion after its two-day meeting ends on Wednesday, may hint at an approaching hike in interest rates in light of U.S. labor market growth.
"People are starting to believe there is going to be concrete action from the Fed in terms of raising rates," said Joseph Trevisani, chief market strategist at WorldWideMarkets in Woodcliff Lake, New Jersey.
He also said U.S. second-quarter gross domestic product growth of 3 percent or more will reinforce the belief a rate hike from the Fed is approaching. A hike in interest rates would boost the dollar by attracting investment flows into the United States, analysts have said.
The GDP data, also set for release on Wednesday, is expected to show a 3 percent advance after a 2.9 percent contraction in the first quarter, according to a Reuters poll of economists.
Traders also eyed Friday's report of U.S. nonfarm payrolls growth, which economists expect will show U.S. employers added 233,000 jobs in July, down from 288,000 in June but still showing solid momentum in the U.S. labor market.
Conference Board data on Tuesday showing its index of U.S. consumer confidence rose to 90.9 in July, beating economists' expectations of 85.3 and marking its highest since October 2007, helped underpin the dollar's strength against major currencies.
The data added to a stronger picture of U.S. consumer confidence, while the labor market components of the report were "healthy," said Alan Ruskin, global head of foreign exchange strategy at Deutsche Bank in New York.
The euro was last down 0.2 percent against the U.S. dollar at $1.3412, just under a fresh eight-month session low of $1.3411. The dollar was last up 0.22 percent against the Japanese yen at 102.09, and was up 0.29 percent against the Swiss franc at 0.9062 francs.
The U.S. dollar index, which measures the dollar against a basket of six major currencies, was last up 0.21 percent at 81.192. U.S. government bond yields dipped lower, with the benchmark 10-year yield at 2.47 percent, from 2.49 percent late Monday.
(Reporting by Sam Forgione; Additional reporting by Patrick Graham in London; Editing by Tom Brown)
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