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Dollar firms against euro on US stimulus package

The dollar rose against 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 US$1.4680 around 10pm GMT from US$1.4756 late on Thursday in New York. But the greenback eased to ¥106.76 from ¥107.16 late on 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 on 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.

In late New York trading, the dollar firmed to 1.0965 Swiss francs from SF1.0875 on Thursday.

The pound was at US$1.9830, up from US$1.9761.
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