USD continues to decline versus euro, yen
by Elaine Frei
The US dollar weakened again, hitting all-time lows versus the euro and the Swiss franc while it fell to a 12-year low against the yen on a number of issues, including some speculation that central banks could intervene to shore up the US currency.
The issues affecting the dollar included the possibility of intervention, a rescue plan for Bear Stearns (NYSE: BSC) after its CEO said that its liquidity position had “significantly deteriorated” in the past day, and bets that the Federal Reserve will cut US interest rates by a full percentage point next week.
The US dollar fell to another record low versus the euro on Friday when it slipped to $1.5688 to the shared currency before gaining back some losses in midday trade in New York, while the dollar also dropped to a 12-year low versus the yen and fell below parity with the Swiss franc for the first time ever.
Near noon in New York the dollar traded at $1.5613 to the euro after earlier falling to an all-time low of $1.5688 to the euro, while the greenback traded at $2.0305 to the pound.
It took ¥100.2250 to buy a dollar after it took as little as ¥99.57 to buy a dollar earlier in the session.
While the news from Bear Stearns hurt the dollar, its effect of frightening investors away from carry trades sent the yen to ¥156.4826 to the euro and to ¥203.5067 to the pound, while the Swiss franc traded at SFr1.0065 to the dollar after trading at SFr0.9988 to the US currency for the first time ever.
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