Euro Steady Against US Dollar

The euro held steady against the dollar on Tuesday, before the U.S. Federal Reserve announced its decision on interest rates, widely expected to be a third cut for this year.

The 13-nation euro bought US$1.4714 in morning European trading, barely changed from the US$1.4712 it bought in New York late Monday. The British pound also was marginally higher, edging up to US$2.0464 from US$2.0462.

The dollar climbed to 112.11 Japanese yen from 111.67 yen.

The Fed meets later Tuesday to discuss interest rates, with analysts expecting the U.S. central bank to trim its key rate, now at 4.5 percent, by a quarter of a percentage point. Some have speculated about the possibility of a half-point cut.

The expected cut would be the third since September amid mortgage problems in the U.S. that have tripped up borrowers and caused a credit crisis among banks _ fueling wider fears about the health of the U.S. economy.

Lower interest rates can jump-start an economy, but they can also weaken a currency as investors transfer funds to countries where they can earn higher returns.

Last week, the Bank of England cut its benchmark rate to 5.5 percent from 5.75 percent, but the European Central Bank left its rate unchanged at 4 percent.