» Forex - ECB focus on inflation as Oil surge to fresh record high $ 122.31

The Dollar edged lower against Euro and Yen on Tuesday, its second straight daily decline, after a bigger-than-expected quarterly loss at Fannie Mae suggested more financial market turmoil ahead. Analysts said that was worrisome for the Dollar because it suggested problems in the troubled US housing sector have yet to work their way through the economy.

Record high oil prices were seen reinforcing the European Central Bank’s focus on inflation, which bank President Jean-Claude Trichet on Monday termed a “significant” risk. This underlined expectations that the ECB would keep rates at 4% when it meets on Thursday.

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