The Swedish krona gained versus the dollar on Wednesday.

The US dollar index, which measures the greenback’s movements against a basket of six major currencies, fell to 74.890, compared with 75.038 in New York Tuesday. The dollar index dipped around 5.1% so far in 2011.

The Swedish krona surged to 6.1979 versus the greenback, versus 6.2178 the previous day. The Swedish central bank is expected to raise rates from 1.50% to 1.75% at a meeting later Wednesday.

NZ Dollar Falls

The New Zealand dollar recorded the biggest fall in over a month today after report showed a slowdown in the nation’s inflation, signaling a loss of momentum in the economic recovery.

The consumer prices index in New Zealand increased 0.8 percent during the first quarter of the year, which is way below the 2.3 percent rise in the last quarter of 2010. Most analysts were expecting the CPI to gain by 1 percent.

NZD/USD tumbled to 0.7916 at about 10:09 GMT today from the opening level of 0.7995. NZD/JPY posted 65.57, a fall from the opening price of 66.52.

Euro Struggles back

The euro grounded higher against the dollar and Swiss franc in European trading hours Tuesday, aided by unexpectedly strong regional economic data and an uneventful Greek T-bill auction after a volatile session Monday.

"It was such a traumatic day yesterday that the likelihood was that the market would reassess today," said Daragh Maher, senior currency strategist at Credit Agricole in London.

China want to cut Foreign Reserves

China must reduce its foreign exchange reserves as they are beyond the level the country needs, central bank Governor Zhou Xiaochuan said at a speech at Tsinghua University in Beijing on Monday.

China's foreign exchange reserves rose 24.4% year-on-year to $3.044 trillion by the end of March, cementing even further its position as the world’s largest holder of foreign exchange reserves, according to data released by the People's Bank of China on April 14. Its holdings exceeded $2 trillion for the first time in June 2009.


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