Dollar Strengthens as Hopes for Rate Cut Build

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The dollar rose against the euro as market participants expressed hopes that the

Federal Reserve will cut interest rates for the 10th time this year when its policymaking committee meets Tuesday.

The euro fell to 89.68 cents from 90.27 on Friday. The dollar was basically flat against the yen, trading at 121.77 yen, compared with 121.73 in the prior session.

According to several polls, the majority of economists expect the

Federal Open Market Committee to lower the fed funds target rate by 50 basis points to 2%. At 2.5%, the bank overnight lending rate is already at its lowest level in 39 years. A reduction of at least 25 basis points is all but guaranteed.

Britain's pound fell to $1.4513 from $1.4596 after an industrial report out of the U.K. added to the worry that the nation's economy is slowing. The pound recently rebounded to $1.4564. The euro bought 109.08 yen.