Monday, 6 Jul 2009

Greenback Rallies vs. Most Rivals but Loses Against Japanese yen

The U.S. dollar remained higher against most major currencies Monday except the Japanese yen, as uncertainty over a global economic recovery prompted investors to buy currencies perceived as less risky. The U.S. and Japanese currencies touched the strongest levels in almost 2 weeks versus the EUR as equities around the world fell, encouraging demand for a refuge. Both the dollar and the yen are seen as currencies that benefit from a decline in risk appetite among investors.

The dollar advanced 0.1% to $1.3961 per EUR and 1.5% vs. the British pound to $1.6096. The Sterling slid after last week's 1.2% decrease as the U.K.'s Sunday Times said the central bank may advance its program of asset purchases by 25 billion pounds ($40 billion). The Japanese currency rallied across the board, gaining against the Dollar and the British pound. The Dollar fell 0.9% to 95.13 Japanese yen. One potential hurdle for the U.S dollar could come later this week if a G8 meeting in Italy features discussion about diminishing the dollar's role as world reserve currency, analysts said.