Euro falls against dollar, yen
LONDON: The euro weakened against the dollar and yen, as some traders pared bets on interest rate increases this year by the European central bank after comments by President Jean-Claude Trichet. The ECB on Wednesday raised its benchmark borrowing cost to a six-year high of 4%. The European currency fell as far as $13495 and was trading at $1.3503 in afternoon trade in London from $1.3524 late on Tuesday in New York. The currency traded at 163.58 yen, from 164,16 yen on Tuesday. Traders pared bets that the ECB will lift rates to 4.5% this year. The implied yield on the December Euribor contract fell to 4.54% from 4.57% earlier.
Euro at record high against yen
LONDON: The euro rose to a record against the yen and strengthened versus the dollar on speculation inflation will accelerate in Europe, forcing policy makers to push interest rates higher through the rest of this year. The euro rallied the most in almost three weeks against the dollar after news reports said that the European Central Bank will lift inflation and economic growth forecasts for the region. The ECB, due to meet on June 6, is expected to increase borrowing costs by a quarter point to 4%, economists unanimously predicted in a Bloomberg survey. The euro reached 164.36 yen, a record, before trading at 164.20 in morning trade in New York, compared with 164.14 late June 1. The European currency traded at $1.3483, from $1.3449.
Dollar rises against yen
LONDON: The dollar traded near the highest against the yen in more than four months as the US yield advantage over Japanese assets may widen over reduced expectations of a Federal Reserve interest-rate cut. The yen erased gains made after a plunge in Chinese stocks had a limited effect on Asian markets.
The US dollar may extend six weeks of gains as traders scale back bets the Federal Reserve will lower borrowing costs. Stronger demand for services may add to evidence the world’s largest economy is rebounding from the slowest growth last quarter in more than four years, a report will probably show tomorrow. The dollar traded at 121.94 yen in morning trade in New York from 122.101ate on June 1, when it reached 122.14, the highest since January 29. It traded at $1.3465 against the euro, from $1.3449.
Rupee closes weak
THE rupee on Monday ended at 40.53/54 levels per dollar, marginally weaker than die previous close of 40.52 per dollar. The local currency breached the 40.50 mark per dollar and rose to an intra-day high of 40.44 against the greenback. But, as the local currency swept past the 40.50-mark, nationalised banks stepped in to buy dollars, on behalf of the central bank. Public sector banks were seen mopping up dollars between the 40.46-40.51 levels, as the RBI was more concerned about the rupee rather than the impact of rising liquidity caused due to its intervention. Forward premia ended the day lower, as the yield on the one-month contract dosed at 0.78% (1.45%). Similarly, the yield on the six-month premia ended at2.33% (2.58%) while that on the one-year premia dosed at 2.51% (2.73%).
