Euro higher to $1.4800 in European morning trade

Euro higher to $1.4800 in European morning trade as investors expect ECB to hold rate steady

• On 1:30 am EST, Tuesday November 3, 2009

FRANKFURT (AP) -- The euro rose against the dollar Tuesday as investors bet the European Central Bank will hold its main interest rate steady at 1 percent later this week.

The 16-nation euro bought $1.4800 in European morning trade, up from the $1.4753 in late New York trading Monday.

The British pound rose to $1.6393 from $1.6383, while the dollar fell to 90.21 Japanese yen from 90.35 late Monday in New York.

Investors expect the ECB to hold its main interest rate steady when it meets on Thursday. Though at historic lows, the ECB's rate is higher than that of the Bank of England and the U.S. Federal Reserve.

Higher interest rates can support the euro as investors move funds to that currency where they can earn better returns than in the pound or dollar .

"Another week of upbeat evidence paves the way to the November ECB meeting where no major surprises are expected," UniCredit wrote in a research note.

UniCredit said the ECB would announce details of its exit strategy from its extraordinary measures to get more credit flowing through the financial sector at December's meeting.