A gauge of expectations of currency swings fell to the lowest in almost seven years before the Federal Reserve begins a two-day meeting. Australia’s dollar sank to a three-week low as iron ore prices slumped.
The dollar was near its weakest in two weeks versus the euro with the Fed forecast to reduce bond purchases when its meeting concludes tomorrow. Benchmark rates in the U.S. will probably remain unchanged this year, futures pricing indicates. The pound was near a four-year high versus the dollar ahead of U.K. data on first-quarter growth.
“The Fed is on a reasonably predictable course,” said Sam Tuck, a senior currency strategist at ANZ Bank New Zealand Ltd. in Auckland. “What we’ve got at the moment is a global environment that’s relatively classified as benign and stable, not too hot, not too cold.”