US dollar advances on yen, euro

The US dollar gained on the yen and the euro on Wednesday on a new $75 billion plan from the administration of US President Barack Obama that is designed to slow the number of home foreclosures in the United States by allowing millions of homeowners to refinance their loans with Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE).

The yen also weakened versus the euro and the Australian dollar on hopes that a success for the Obama plan will reduce demand for the yen as a safe investment, while the euro was hurt by the possibility that Eurozone banks could be harmed by the ongoing recession.

By nearly noon in New York, the yen traded at ¥93.835 to the US dollar, at ¥117.5877 to the euro and at ¥59.8628 to the Aussie while the greenback was at $1.2531 to the euro.

Meanwhile, the Canadian dollar gained on its US counterpart on hopes that the Obama plan to reduce home foreclosures will revive investor interest in risky currency investments by helping the US economy toward recovery.

In late morning trade in New York the loonie traded at C$1.2596 to the US dollar.

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