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Dollar holds ground after Citigroup earnings report

The US dollar held firm on Friday amid news that US banking giant Citigroup, hard-hit by a sharp downturn in the US housing market, posted a smaller than expected quarterly loss.

The euro was quoted at US$1.5846 from US$1.5850 late on Thursday in New York.

The dollar meanwhile firmed to ¥106.95 from ¥106.37 on Thursday.

The news from Citigroup, one of the biggest US banks, helped calm jitters about the health of the financial sector in the world’s largest economy.

The bank posted a US$2.495 billion quarterly loss on more hefty real estate writeoffs in results that were not as bad as had been feared.

The loss, amounting to US$0.54 a share, was somewhat better than anticipated on Wall Street, where analysts had been expecting a deficit of US$0.61 a share.

“Several other US banks have reported better than expected second-quarter earnings, relieving some of the worst concerns about the US financial markets and contributing to yesterday’s strong equity market performance and dollar short covering,” said Hilary Love at PNC Bank.

“A drop in oil prices also helped the US dollar,” she said.

In late New York trading, the dollar stood at 1.0223 Swiss francs from SF1.0197 on Thursday.

The pound was at US$1.990 after US$2.0014.

The Philippine peso led gains among Asian currencies last week after the central bank on Thursday raised its benchmark interest rate by more than most economists forecast to temper inflation.

The peso rallied to its biggest weekly gain in almost seven years as crude oil headed for the biggest weekly slump since December 2004.

The peso gained 2.6 percent this week to 44.455 a dollar, the most since the week ended Aug. 10, 2001, the Bankers Association of the Philippines said.

The South Korean won completed its biggest weekly loss this month as overseas investors reduced their holdings of local shares for a 30th straight day, boosting demand for dollars.

The currency pared last week’s advance, the biggest in a decade, on speculation the Bank of Korea ended purchases of its own currency. Vice Finance Minister Kim Dong-soo said on Tuesday inflation could damp the economy as the government trimmed its growth estimate for this year to 4.7 percent from 6 percent.

The won declined 1.2 percent for the week to 1,013.80 per dollar, according to Seoul Money Brokerages Ltd.

The Malaysian ringgit fell for a third day on Friday on concern a leadership struggle would distract the government from taking measures to tackle inflation and spur economic growth.

The ringgit weakened 0.3 percent to 3.2413 versus the dollar, data compiled by Bloomberg showed.

Elsewhere, the New Taiwan dollar strengthened 0.1 percent last week to NT$30.36 and Indonesia’s rupiah rose 0.1 percent to 9,152. The Singaporean dollar rose 0.4 percent to S$1.3532 per dollar, Vietnam’s dong added 0.3 percent to 16,795 and Thailand’s baht rose 1 percent to 33.33 for its best week since February.
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