Donnerstag, 18. November 2010

Dollar falls against euro as Ireland worries ease (AP)

NEW YORK ? The dollar fell against the euro Thursday as traders became more confident that Ireland would get financial help from the European Union and International Monetary Fund.

The dollar had been gaining against the euro since Nov. 4 after signs emerged that Ireland might need help managing its massive debt load. Ireland has struggled since it bailed out three of its largest banks following the collapse of the nation's housing market.

Investors have grown concerned that a debt crisis in Ireland could drive up borrowing costs in other indebted countries such as Spain and Portugal. The European currency got relief Thursday as officials from the EU and IMF worked to hammer out a deal to shore up Ireland's finances.

The crisis in Ireland is "likely coming to a close, for now," said Brothers Harrimany currency analysts wrote in a note. That suggests the dollar will drop a bit more, in the short term, against the euro after its climb over the past 2 weeks.

In late trading in New York, the euro rose to $1.3635 from $1.3522. The British pound followed suit, rising to $1.6044 from $1.5899.

Britain, which is not a member of the 16-nation bloc that uses the euro, has also pledged financial support. Some of Britain's biggest banks hold Irish government bonds, and would suffer losses if Ireland were to default.

The dollar rose to 83.45 Japanese yen from 83.28 yen and rose to 0.9965 Swiss francs from 0.9920 Swiss francs, but fell to 1.0214 Canadian dollars from 1.0236 Canadian dollars.

The U.S. currency also dropped versus currencies of countries that are big commodity exporters, such as Australia. Its currency tends to rise when investors feel that the global economy is strengthening and will likely require more basic materials such as coal and iron ore. Emerging-market currencies in Latin America and Asia also rose.



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Source: http://us.rd.yahoo.com/dailynews/rss/eurobiz/*http://news.yahoo.com/s/ap/20101118/ap_on_bi_ge/dollar

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