NEW YORK, Jan 26: The dollar rose on the euro on Friday, continuing to find support from a quick accord on an economic stimulus plan between the White House and Congress.

The euro fell to 1.4680 dollars around 2200 GMT from 1.4756 dollars late Thursday in New York.

But the greenback eased to 106.76 yen from 107.16 yen late Thursday.

Dealers said that after a dramatic week marked by the US Federal Reserve’s bold emergency interest rate cut of three quarters of a percentage point, sentiment was calmer Friday as all eyes turned to next week’s regular Fed meeting.

They said expectations are for the Fed to cut interest rates again, most likely by a half a percentage point, but as players are now counting on this sharp medicine to boost the US economy, such a move could support the dollar.

In a week bereft of major economic data, the currency market took its cue from the volatile stock markets as investors try to gauge whether the US economy is headed for recession or a slowdown.

Risk aversion/risk assumption remains the only game in town, said Boris Schlossberg, an analyst at Forex Capital Markets.

Anticipation of lower interest rates have kept the dollar on the defensive for some time but now coupled with the stimulus package, many expect the US economy to do better this year, possibly avoiding recession.

Dealers said news of a nearly five-billion-euro (7.15-billion-dollar) rogue trader loss at French bank Societe Generale had had only a limited impact on the markets, adding to volatility when it was announced Thursday.

The euro remains unfazed by the biggest trading loss in banking history as the ECB (European Central Bank) is considered among the last ... to allow its independence to be swayed by a fraudulent operation or pressure from politicians, said Ashraf Laidi at CMC Markets.

We expect the Fed would go for a cut of half a percentage point, said Hideaki Inoue of Mitsubishi UFJ Trust and Banking Corp.

As the United States is drawing out tax reduction measures (under its stimulus plan), the worries in the markets will likely recede, he added.

In late New York trading, the dollar firmed to 1.0965 Swiss francs from 1.0875 Thursday. The pound was at $1.9830, up from 1.9761.—AFP