| |
| |
![]() |
| |
|
| |
|
| |
|
NEW YORK: The US dollar found some breathing room on Friday as investors looked for safe havens from equity market turmoil and a top European official warned of the perils of a strong euro.
Disappointing results from Bank of America and General Electric raised fresh worries about the economic outlook and hit world stock markets, prompting increased risk aversion and dollar buying, analysts said.
The euro was changing hands at 1.4903 dollars at 2100 GMT compared to 1.4941 dollars in New York late on Thursday.
The dollar rose to 90.87 yen from 90.57 yen.
The market showed little reaction to US economic data that was generally positive.
The Federal Reserve reported US industrial production rose 0.7 percent in September after an upwardly revised gain of 1.2 percent in August.
A Treasury report showed net long-term capital flows to the United States rose to 28.6 billion dollars in August on the back of foreign demand for US bonds and other assets, easing pressure on the US as it finances its deficits.
Michael Woolfolk at Bank of New York Mellon said investors were more interested in corporate news as a harbinger of the economic outlook.
"US data continues to take a back seat to US corporate earnings releases, as risk appetite remains dependent on the continued rally in equities," he said.
He said the equity slump "provides players with a convenient excuse to take profit on short dollar positions and reload for next week with the 1.500 objective in the euro-dollar rate looming large."
Despite its fall, the euro remained within sight of the 14-month peak of 1.4968 dollars that was struck on Thursday when growing economic optimism persuaded investors to seek assets that are deemed to carry more risk.
The euro has risen by around 18 percent against the dollar since March as growing confidence in the economic recovery from the worst global recession since World War II has turned investors towards the high-risk, high-yield euro.
But many warn a much stronger euro will make Europe's exports too expensive.
"If the euro's direction were to continue to move along the lines of recent weeks, there is a risk...that it could slow economic recovery in Europe," said Jean-Claude Juncker, Luxembourg's prime minister and head of the Eurogroup.
Currency analyst Daragh Maher, who works for French investment bank Calyon, said there was likely to be "growing nervousness over the rise of the euro."
In late New York trade, the dollar was fetching 1.0179 Swiss francs from 1.0147 on Thursday.
The pound firmed to 1.6357 dollars after 1.6268. - AFP/de
|
