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LONDON : The dollar was stable against the euro here Friday, with the single currency hurt by a weak reading on German industrial orders.
The European currency in late day trade was at 1.57 dollars against 1.5694 late Thursday.
The dollar was likewise unchanged against the yen at 106.63 after 106.75 on Thursday.
Trading was thin in the absence of activity in the United States, where markets were closed for the Independence Day holiday.
The euro trailed the dollar for the most of the day, still feeling the effects of comments Thursday from the head of the European Central Bank suggesting there would be no further eurozone interest rate hikes in the near future.
The bank on Thursday raised its benchmark rate a quarter of a point to 4.25 percent in a bid to curb record eurozone inflation. But ECB president Jean-Claude Trichet later signalled that additional rate hikes were not likely.
Prospects for a series of rate rises would have made the euro more attractive to investors and would have driven up its value against the dollar.
Also weighing on the euro was a report that German industrial orders fell in May for the sixth month in a row, prompting analysts to voice alarm and declare an end to a vital boom in the manufacturing sector.
Orders fell by 0.9 percent in May from the previous month in Europe's biggest economy, according to provisional and seasonally corrected figures released by the economy ministry.
For Natixis analyst Costa Brunner, the latest decline "is definitely an alarming sign for the German industry and the economy as a whole."
Postbank's Fabienne Riefer said the German industrial sector's "best days are behind it," while Matthias Rubisch at Commerzbank declared: "The boom in the manufacturing sector is over."
Germany, which is also the world's leading exporter at present, has resisted a slowdown seen in other eurozone countries and the United States but is now headed for a patch of much weaker growth.
European Commission chief Jose Manuel Barroso said meanwhile that although "part of the problem of the rise of oil and food prices is the falling dollar," he would be "very surprised" if a meeting of Group of Eight (G8) leaders next week in Japan took action on exchange rates.
"We would like to see a more balanced relation between the dollar and other currencies, including the euro," he said. "But I don't expect anything specific at the G8."
Elsewhere, the pound was steady after recovering earlier from a slump Thursday to three-week lows against the euro.
Attention will now turn to an upcoming interest rate decision, with recent weak British data likely to mean the Bank of England is in no position to raise rates in order to counteract rising inflationary pressures.
The outlook for the British economy darkened further this week after indicators for the manufacturing, services, and construction sectors all showed activity has weakened, with unemployment on the rise and expectations for the future falling.
In London trading on Friday, the euro changed hands at 1.5700 dollars against 1.5694 late on Thursday, 167.62 yen (167.55), 0.7924 pounds (0.7914) and 1.6083 Swiss francs (1.6113).
The dollar stood at 106.73 yen (106.75) and 1.0239 Swiss francs (1.0264).
The pound was at 1.9827 dollars (1.9824).
On the London Bullion Market, the price of gold fell to 931.25 dollars per ounce at the fixing from 934 dollars late on Thursday.
- AFP /ls
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