Dollar firm after Fed comments

Tokyo, March 23 | Updated: Mar 24 2005, 05:30am hrs
The dollar held near a one-month high against the euro on Wednesday, boosted after the Federal Reserve signaled it may speed up the pace of interest rate rises to counter any acceleration in inflation.

The central bank has raised the federal funds rate by 25 basis points at seven straight meetings since June 2004.

Short-term US rates stand at 2.75%, above the euro zones comparable rate of 2% and virtually zero percent in Japan.

As of 1:50 am EST, the euro was slightly down at around $1.3070, not far from a one-month low near $1.3055 marked on Tuesday.

The dollar bought around 105.35 versus 105.63 in late US trade, dragged down by a drop in euro/yen. It had risen to a one-month high around 105.70 yen in the previous session.