U.S. dollar weakens against major currencies
Forex March 16th, 2010
U.S. dollar biggest losses recorded since November against the major partner currencies after falling unemployment is fueling speculation the Federal Reserve continued stimulus program.
Sterling is the only currency weakened against the dollar this week after PM Gordon Brown clashed with the opposition Conservative party about the budget deficit.
Greenback weakened from the highest position on the 4-month yen encouraged by the prospects of the economy’s largest country. Last week, the reports said U.S. retail sector growth slows further.
“Investors are disappointed and removing the U.S. dollar, market expectations seem too big,” said Hidetoshi Yanagihara, senior currency trader Mizuho Corporate Bank Ltd. in New York.
Dollar Index, which records the movement of U.S. dollars to euros, yen, and pound, down 0.5% to 77.471 yesterday, from 77.860 on January 1. The index touched the highest since September 78.449 on December 22.
Labor Department reports on U.S. companies cut 85,000 employees during December. While the median estimate of 76 economists said there was no change in the labor sector. The unemployment rate held at the level of 10%.
“The main news is not siding with the U.S. dollar. Perpetrator market flat in a position that caused the Fed’s expectations remain cool,” said Brian Kim, currency analyst UBS AG in Stamford, Connecticut.
The dollar weakened 0.4% to 92.66 yen this week, the first decline in 5 days since December 11. The dollar also weakened 0.6% to U.S. $ 1.4409 per euro, from U.S. $ 1.4324. Euro strengthened the yen at 133.46 from 133.20.
Pressure against the U.S. dollar to below the level of U.S. $ 1.45 reduced after reports of new jobs during 4000 November.
Japanese currency strengthened against the dollar yesterday after the Prime Yukio Hatoyama said the speed of exchange rate movements are not good after the new Finance Minister Naoto Kan insists no problem with the weakening yen.
The yen rose to its highest level in 14 years on the U.S. dollar in November that threatens earnings exporters including Toyota Motor Corp. and Sony Corp..
