UPDATES ON AUG 6 2008

AUG 6 WEDNESDAY

Euro Rises on Speculation ECB's Trichet to Flag Inflation Risk .

The euro rose, rebounding from a seven-week low against the

dollar, on speculation European Central Bank President

Jean-Claude Trichet will signal higher interest rates may

be needed to combat inflation.

The dollar held near seven-week highs against the yen as oil

tumbled to the lowest level in three months, supporting

economic growth prospects in the world's largest

consumer of the fuel.

Oil has lost more than $28 since touching a record of $147.27

a barrel in New York on July 11 as unprecedented fuel costs

prompted U.S. consumers to limit spending.

The Federal Reserve left borrowing costs unchanged

yesterday at 2 percent, saying ``downside risks'' to

growth remain, while inflation is a ``significant concern.''

Traders yesterday pared bets the Fed will raise interest

rates on Sept. 16. Futures on the Chicago Board of Trade

showed a 27 percent chance the Fed would increase its

target lending rate at least a quarter-percentage point,

down from 32 percent on Aug. 4.

The U.S. currency's 25-day moving average versus the yen

has risen since late last month, a bullish signal for the next

few weeks, Tokyo-based Kinouchi said. The dollar may keep

climbing until it reaches 108.76, its 260-day moving average

and a level where sell orders are likely to be placed, he said.