US dollar stronger versus euro

The US dollar strengthened in relation to the euro Monday as the US government and Federal Reserve began putting programs in place to help out mortgage lenders Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE), but gains for the greenback moderated slightly after Freddie Mac sold $3 billion worth of discount notes.

Meanwhile, the euro was hurt by speculation that the European Central Bank might have to cut Eurozone interest rates soon as it began to look as if the economic slowdown in Europe is more extensive than that in the United States.

In late-morning trade in New York, the US dollar traded at $1.5902 to the euro while it took ¥106.3 to buy a dollar.

The Australian dollar gained on the greenback on sentiment that the Australian economy will survive the problems in the US financial sector, as the Aussie traded at 97.18 cents US.

The South African rand strengthened on gains in equities markets and even though its finance minister wrote that his country’s current-account deficit is likely to remain large for a substantial period of time.

The rand traded at R7.6355 to the US dollar just before noon in New York after going as high as R7.6142, while it was at $12.141 to the euro and it took ¥13.920 to buy a rand.

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