Sun, Nov 23, 2003 - Page 10 News List

Euro maintains its lead against the dollar, yen is strong

AFP , LONDON

The euro maintained its lead on the dollar Friday as investors sought to shed the greenback ahead of the week end, fearing future terrorist attacks.

The single European currency in late-day deals was at US$1.1912, up from US$1.1900 in New York on Thursday, capping a volatile week in which it surged to an historic high of US$1.1978.

Against the yen the dollar slipped to ¥108.88 from ¥109 on Thursday.

Simon Derrick at the Bank of New York said the dollar started falling early in the afternoon on rumors that al-Qaeda was planning further attacks over the next few months.

The euro later in the day surpassed US$1.19 after spending most of the session below the mark.

Trading was sluggish, with liquidity thin in the absence of major financial news developments.

Dealers said there was movement out of long dollar positions ahead of the weekend, particularly given that trading will be thinned further by holidays next week.

"I would expect traders to be more reluctant to buy the dollar," he said.

Japan has a holiday Monday, while most of the US will be out Thursday and Friday.

Kamal Sharma, strategist at Dresdner Kleinwort Wasserstein, explained that "our analysis is that in a week devoid of US data, the dollar tends to underperform, given that the market tends to be generally dollar bearish" at the moment.

The euro was changing hands at US$1.1912 from US$1.1900 late on Thursday in New York, ¥129.69 (¥129.81), £0.6992 (£0.6984) and 1.5461 Swiss francs (Sf1.5471).

The dollar was being quoted at ¥108.88 (¥109.00) and 1.2981 Swiss francs (Sf1.2984).

The pound was at US$1.7039 (US$1.7045), ¥185.52 (¥185.77) and 2.2111 Swiss francs (Sf2.2135).

On the London Bullion Market, the price of an ounce of gold edged up to US$395.50 from US$394.30 on Thursday afternoon.

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