Dollar Surges On Fed Rate Move

The dollar is up across the board again this morning after the Fed announced that it would increase the "discount rate" - the interest rate it charges US banks for emergency loans from 0.5% to 0.75%.

That might not sound like a lot, but the market is taking it as a clear sign that there is some upside potential in US interest rates, contrary to rates staying flat for some considerable time yet elsewhere in the world.

The move comes only days after the minutes of the last FOMC meeting revealed that the US was soon likely to begin it's "exit strategy" from its emergency economic support measures of the past two years.

With the EU still mired in crisis with Greece and other member states, and the UK just mired, the dollar has hit multi month highs against both the pound and euro this morning.

At least that might help provide some sort of support for London and Paris wheat, apart from that the positives are few and far between.

Sterling hit 1.5342, whilst the euro fell to 1.3442, both being levels not seen since May 2009.