EUR/USD: The dollar dropped to a four-month low against the euro

Currencies

EUR/USD The dollar dropped to a four-month low against the euro before the Federal Reserve starts a two-day policy meeting today amid speculation it will decide to buy bonds to boost the economy.

• The dollar slid 0.2 percent to $1.2880 per euro at 1:41 p.m. in Tokyo after touching $1.2883, the lowest since May 14. The euro rose 0.3 percent to 100.25 yen. It reached 100.43 on Sept. 7, the most since July 4. The yen slid 0.1 percent to 77.83 per dollar.

GBP/USD The pound rose to the strongest level in almost four months versus the dollar after a report showed the U.K. trade deficit shrank in July as exports soared, adding to signs the economy is emerging from recession.

• Sterling gained 0.5 percent to $1.6067 as of 4:19 p.m. London time, after rising to $1.6079, the strongest since May 15. The pound depreciated 0.2 percent to 79.97 pence per euro, after touching 80.11 pence yesterday, the weakest level since July 5.

USD/CAD Canada’s dollar strengthened to a 13-month high versus its U.S. counterpart, on optimism measures by policy makers in the U.S. and Europe will reduce volatility.

• Canada’s currency, rose 0.5 percent to 97.30 cents per dollar at 4:15 p.m. in New York. It touched 97.14 cents, the highest since Aug. 4, 2011. One Canadian dollar buys $1.02775.

Commodities

Oil traded near the highest level in three weeks amid speculation China and the U.S. will add stimulus to their economies, sustaining demand for fuel in the world’s biggest crude users.

• Oil traded near the highest level in three weeks amid speculation China and the U.S. will add stimulus to their economies, sustaining demand for fuel in the world’s biggest crude users.

Gold climbed for a second day before a Federal Reserve policy meeting that may introduce more stimulus to boost the world’s largest economy. Platinum is poised for the longest rally in more than a year.

• gold rose as much as 0.3 percent to $1,736.45 an ounce, and traded at $1,735.30 at 11:20 a.m., extending yesterday’s 0.3 percent gain as the dollar fell. The metal touched $1,741.70 on Sept. 7, the most expensive since Feb. 29

Equities

Asian stocks rose, with the regional benchmark index headed for the longest winning streak in two months, on speculation China and the U.S. will take more measures to spur growth in the world’s two biggest economies.

• The MSCI Asia Pacific Index rose 1 percent to 120.47 as of 12:49 p.m. in Tokyo, headed for a five-day advance, the longest winning streak since July. About four stocks increased for each that fell. Stocks have gained since the European Central Bank announced an unlimited bond-buying program last week to quell the region’s debt crisis.

European stocks climbed as Germany’s top constitutional court said it will proceed with a ruling on the country’s role in the euro-area bailout fund and speculation grew that the Federal Reserve will boost stimulus.

• Stoxx Europe 600 Index (SXXP) added 0.3 percent to 272.58 at the close of trading, the highest level in three weeks. The measure has surged 11 percent this year as European Central Bank policy makers agreed on an unlimited bond-buying program and speculation grew that the Fed will announce a third round of quantitative easing.

U.S. stocks rose, after yesterday’s drop in the Standard & Poor’s 500 Index, amid speculation the Federal Reserve will act to stimulate the economy.

• The S&P 500 added 0.3 percent to 1,433.56 at 4 p.m. in New York. The Dow Jones Industrial Average gained 69.07 points, or 0.5 percent, to 13,323.36 today. Volume for exchange-listed stocks in the U.S. was 5.9 billion shares, or almost in line with the three-month average.