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Sun, May 11, 2008 - Page 10 News List

Dollar stays under pressure from euro


The US dollar remained under pressure against the euro and other world currencies on Friday, partly as traders continued to bet that an imminent decline in eurozone interest rates was unlikely.

The euro had gained fresh support against the dollar on Thursday after European Central Bank president Jean-Claude Trichet reiterated warnings about inflationary pressures.

Traders interpreted Trichet’s comments as lessening the likelihood of eurozone rate cuts anytime soon.

The euro was swapping hands at US$1.5481 at 9pm GMT, up from US$1.5393 in New York late on Thursday. The dollar meanwhile declined against the Japanese currency to ¥102.82 compared with ¥103.68 a day earlier.

“The euro-dollar [exchange rate] continued its rebound from multi-week lows in the aftermath of yesterday’s very tough, unapologetically hawkish press conference by ECB president Jean-Claude Trichet,” Forex Capital Markets senior currency strategist Boris Schlossberg said.

“Mr Trichet essentially stated that European monetary authorities have no intention of lowering rates anytime soon,” he said.

In late New York trading, the dollar stood at 1.0412 Swiss francs, down from SF1.0512 on Thursday. The pound was priced at US$1.9529, up from US$1.9453.

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