NEW YORK (AP) - The dollar fell against most major currencies Tuesday on expectations that the Federal Reserve will announce new plans to boost the U.S. economy.
The euro rose to $1.2689 from $1.2580 late Monday. Earlier, the euro rose as high as $1.27304, a four-week high against the dollar.
The Fed ends its two-day meeting Wednesday. Economists expect the central bank to either announce new bond-buying plans or to signal that a plan is in the works.
The Fed has launched two rounds of bond purchases, most recently in August 2010, to lower long-term interest rates and make stocks more attractive to investors.
Lower interest rates can weigh on a currency by reducing the returns investors get from holding it. With a third round of bond-buying still an option, traders sold dollars.
In other trading Tuesday, the British pound rose to $1.5730 from $1.5665 late Monday
The dollar fell to 79.04 Japanese yen from 79.13 yen, to 0.9464 Swiss franc from 0.9546 Swiss franc and to 1.0180 Canadian dollar from 1.0247 Canadian dollar.
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