The dollar fell the most against the euro in two weeks on speculation industry reports will show U.S. consumer confidence dropped to a five-year low and the housing slump deepened.
The dollar dropped from a one-week high against the yen as Deutsche Bank AG economists joined those forecasting the economy will suffer a recession. The U.S. currency also weakened against the Australian and New Zealand dollars, favorite targets of so- called carry trades, as a rally in European and Asian stocks encouraged investors to buy higher-yielding assets.
``Interest rates will continue to come down and that means that the dollar is going to continue to weaken in the short term,'' said Peter Rosenstreich, the chief market analyst at ACM Advanced Currency Markets SA in Geneva. ``Our base case scenario is very much grounded in the U.S. going into recession and probably deeper and longer than we had expected.''
The dollar fell to $1.5544 per euro at 10:12 a.m. in London, the biggest drop since March 12 based on closing prices, from $1.5423 late yesterday in New York. It declined to 100.51 yen, from 100.74 yesterday. The euro rose to 156.24 yen, from 155.39. The pound gained to $1.9915 from $1.9855. The dollar will fall to $1.58 per euro in coming weeks, Rosenstreich forecast.
Against the Australian dollar, also known as the Aussie, the U.S. currency weakened to 91.36 U.S. cents, from 90.59 cents yesterday. It declined to 80.39 U.S. cents per New Zealand dollar from 79.77 cents and dropped 2.1 percent versus the Korean won, to 976.6.
No comments:
Post a Comment