Dollar trades near record lows versus euro
 

NEW YORK - The dollar traded near record lows versus the euro on Thursday over renewed concern about the health of the US housing market and as investors pondered the Federal Reserve?s next interest rate move.

The dollar reached its lowest levels in years on Wednesday following a speech by Fed Chairman Ben Bernanke in which he cut growth forecasts for the US economy for this year and next and said the hard-hit housing market will remain sluggish.

Bernanke is giving a second day?s testimony to Congress. Analysts expect his speech will reiterate Wednesday?s remarks on inflation.

?Less hawkish comments from (Ben) Bernanke yesterday are not helping the dollar,? said Steven Butler, director of foreign exchange trading at Scotia Capital in Toronto. ?He showed a little less concern about housing than he had let on before but it seems there is a lot of euro crosses dominating today and that?s keeping the euro well-supported.?

In mid-morning trading in New York, the euro was up 0.1 percent on the day at $1.3819, having hit $1.3834 on Wednesday according to electronic trading system EBS, its strongest level since its launch in 1999.

The dollar also touched a record low versus the euro on Wednesday on news two Bear Stearns hedge funds exposed to the risky subprime mortgage sector were now virtually worthless.

Sterling was down 0.2 percent at $2.0472 after softer-than-expected UK retail sales data, coming further off a 26-year peak of $2.0548 hit on Wednesday.

The dollar was up 0.2 percent at 122.09 yen but the dollar index, a measure of its value against a basket of six major currencies, was slightly down at 80.352.

The index fell to a 12-year low of 80.227 on Wednesday.

The Philadelphia Federal Reserve Bank will release its business activity index for July at 12 p.m. (1600 GMT) and the Fed publishes minutes from its June 27-28 policy meeting, where it kept key US interest rates unchanged at 5.25 percent.

The market currently reckons US rates will have to stay on hold or be cut at some point but analysts expect the Bank of England and the European Central Bank to raise rates in September, which is seen supporting the pound and the euro.

?The FX market has warmed to the idea that the Fed?s going to be on hold for the rest of the year so it will have to look elsewhere for direction, probably other asset classes. The dollar?s movements are very much dependent on how the US corporate bond market trades, at least for the time being,? said Paul Mackel, senior currency strategist at HSBC in London.

Riskier asset classes like corporate bonds, equities and emerging markets were steady to firmer on Thursday, while government bonds were weaker.

Currency markets showed little reaction to data from Beijing on Thursday that showed China?s economy in the second quarter grew at a sizzling 11.9 percent, the fastest pace of growth in 11 years.

http://www.khaleejtimes.com/DisplayA...ction=business

I hope it'll get better after the 2008 US elections :)

I couldn't be more sad.

:(

good call.... the US will be buoyed by the prospect of that dumfuck getting out of office.

Dollar has to recover after that

Losing so much money :/

:Oh crap

It may recover but not by much , so don't hold your panties
in a bunch :winkwink:

i want to throw up every day :-/

it's all about oil shit

maybe the canadian dollar will go over 1:1 with the us$ :D

The Aussie dollar's been around 87-89 cents lately whenever I go to the bank.
I almost cry for the day's when I used to double my money. There was little sweeter than rocking up with a handful of checks and walking out with twice the amount.
I doubt we'll see those days agin anytime soon.

The last payout was a SHAME. The Norwegian Krone is very strong, and the us dollar is very weak. The payout sucked! :(

yea, the canadian dollar has been doing fantastic as well

1 USD = 1 CAD just about now .... that's just damn scary

I'm shooting in Hungary and am making 30% less profit, than when I started 4 years ago, because the US dollar is so low!

...and more great news are coming..

i love selling content in europe.. nice euros..

:)
 

Exactly, with Euro You don't get less & less money each month.

Unluckily Slovakian Krone goes high so much so I'm losing both with Euro & Dollar.

It's not going to go up any time soon.

There is going to be a major housing surplus in the coming months. Banks are forecasting a 40% foreclosure rate for homes bought on in 2004-2006 starting at the end of this month. Your debt is going through the roof right now as well. People are also not as interested in buying US $$$ when the economy is sliding. The only hope for the US $ is that other countries devalue their $ so that imports and exports remain the same as they have in the past.

:Oh crap

its not about oil, it is about wanting to create a North American Union. The leaders in the US want to have the dollar drop and become equal with the Canadian $.

who was president 12 years ago?

There are some people here in Venezuela making some serious bank with the currency exchange control. The official rate is Bs.2150 per dollar and the unofficial is around Bs.4000
So some guys figured that they would set up offshore merchant accounts and stuff and they are letting people exchange their annual $3000 allowance at the official rate via these points of sale.
They keep around 10% of the $3000. And they do this many,many times a day.
Anyone interested ? :)

It sucks. Time to buy some gold.

yeah, Cdn dollar is practically equal to the US dollar now.. sucks

i'm just wondering how long you americans will put up with this shit until you impeach your president.

that sucks...it costs me too much :(

That is also a 30+ year low against Sterling as well Barefootsies - the dollar is worth .48 cents against GBP.

The good news is anyone currently buying assets in Sterling are getting a good deal - a $300K home costs less than 150 UK Pounds. You could hardly buy a one bedroom apartment in the UK for that money *lol*



PS BTW - Nice currency article from the Khaleej Times - courtesy of Reuters :)

I love it when economists say this just means we will be able to export easier into other countries...

Let me give you some info about that...

Our radios still cost twice as much as Japanese radios so we will NOT be selling any extras.... our dollar will just suck.

100% correct! That is the core problem and at least a significant reason why the dollar is weak at the moment - there are far too few exports despite the dollar "should" be advantageous.

The last time there was a trading surplus was around 40 years ago - the problem may be with a lack of sufficient manufacturing capacity at a competitive price - tho almost all western "industrialized" countries have that same competitive problem.

The flipside is too much consumption of foreign product (and oil) - if more US manufactured product was consumed in the US (instead of Chinese imports) - that would help balance the books much better.