The dollar was down against the Euro and Yen Wednesday on Speculation that the Fed will refrain from a rate hike in the short term. With US durable goods orders out today at 12:30 GMT, analysts are predicting a decline in orders due to reduced consumption. The expectation is that bookings for goods in the US were unchanged in July. If the data comes out below expectations we could well see downward pressure on the greenback. 'The dollar still faces some risks of further declines,'' said the chief analyst for global market sales and trading in Tokyo at Bank of Tokyo-Mitsubishi UFJ Ltd 'The dollar declined to $1.4685 per euro at 8:14 a.m. in London from $1.4653 in New York yesterday, when it hit $1.4571, the strongest since Feb. 14.

Meanwhile the Wall street journal is predicting likely decline of the Euro and Sterling against the dollar as economies outside the US continue to be hit by the credit crunch. The Bank of America expects a rate cut to 3.5% in the UK by the end of 2008. Sterling hit a 12 year low on Wednesday against a basket of currencies on pessimistic sentiment about the UK economy. There is growing feeling that the struggling Euro Zone will impact Britain negatively. At 10am GMT GBP/USD was trading at 1.8458

Meanwhile the Australian and New Zealand Dollars were both lifted from weak levels as investors began buying higher yielding currencies. A recovery in the US and Asian stock markets has encouraged the purchasing of shares and currencies carrying higher interest rates such as the 'Aussie' and the 'Kiwi.' Although so called carry trade currencies tend to show higher volatility, there is more appetite for risk as world stock markets improve.

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