Dollar Slips to $1.41 per Euro on Economy, Higher-Yield Demand
By Oliver Biggadike and Anna Rascouet
May 29 (Bloomberg) -- The dollar declined beyond $1.41 against the euro for the first time this year as evidence the global recession is easing sent investors in search of assets with higher returns.
The U.S. currency also headed for its biggest monthly drop versus the euro in 2009 and fell today against major counterparts including the Australian and New Zealand dollars as South Korea said its state pension fund plans to hold fewer Treasuries. The U.S. securities were poised for a second month of declines on concern debt sales will overwhelm demand.
“It’s a fundamental dollar-down trade,” said James McCormick, global head of foreign exchange and local market strategy at Citigroup Inc. in London. “The truth is that countries like the U.S. with handicapped banking systems, with overextended fiscal policy, are going to see very shallow recoveries.”
The dollar weakened 1.3 percent to $1.4128 per euro at 2:44 p.m. in New York, from $1.3941 yesterday, bringing its decline this month to 6.4 percent, the biggest since December, when it dropped 9.2 percent. The dollar depreciated 1.8 percent to 95.10 yen from 96.85. The yen advanced 0.5 percent to 134.38 per euro from 135.04 yesterday.
Sterling increased as much 1.6 percent to $1.6198, the highest level since Nov. 5, and headed for a 9.3 percent monthly gain, the biggest since 1985. Nationwide Building Society said U.K. house prices unexpectedly jumped 1.2 percent in May, and the market researcher GfK NOP reported consumer confidence matched the highest level in almost a year
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Well - this moron from UBS doesn't take into account the massive printing of money is weakening the dollar. I see the Euro going to 2 or 4 by the fall and I'm financially positioned to profit from the dollar's weakness. Europe has its problems too, but not nearly as bad as the US.
ReplyDeleteI do agree with your analysis Rob ...the US Dollar is over ....why not profet from its fall
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