US dollar stronger versus euro, yen

The US dollar was stronger as the leaders of the G8 nations began their meeting in Japan, with gains coming on lower prices for crude oil and on comments from US President George W. Bush supporting the idea of a strong dollar and insisting on the fundamental health of the US economy.

At just past noon in New York, the dollar traded at $1.5695 to the euro, which was down on drop in industrial production in Germany, while it took ¥107.1850 to buy a dollar.

The euro, the South African rand and the Mexican peso were all also stronger versus the yen, with declines by the yen against the rand and the peso based on increased popularity of carry trades as equities markets advanced.

The yen traded at ¥168.2267 to the euro, at ¥13.849 to the rand, and at ¥10.379 to the peso in midday trade in New York.

The rand, however, declined in relation to the US dollar to trade at R7.7488 to the greenback on indications that importers are selling the currency to take profits after four days of gains.

The pound weakened on new data from the Office of National Statistics which showed that manufacturing output in the UK dropped 0.5 percent in May from the previous month against a prediction of no change, making it less likely that the Bank of England will hike interest rates at its meeting later in the month.

In early afternoon trade in New York it took $1.9744 to buy a pound while the UK currency stood at 79.49p to the euro.

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