Dollar Slides Against Euro
Oct 14th, 2008 | By Doug Casey | Category: Financial News, US Dollar & Forex TradingIn the currency market, the dollar moved lower against the euro. Late Monday, the euro was trading at $1.3587 vs. $1.3394 on Friday.
The dollar slipped even as the Dow was blasting up 940 points, to score its biggest one-day gain in history.
But currency traders reacted to news over the weekend that Europeans are taking steps to shore up their own system, thereby giving a boost to the euro. Meeting in Paris, leaders of the 15 euro-zone countries jointly agreed Sunday to a plan that will guarantee loans between banks through 2009 and allow governments to buy stock in distressed financial companies.
Germany and France unveiled bank rescue plans worth a combined $1.1 trillion, while Britain said it will inject as much as $63 billion into three banks, giving a lift to sterling, which had fallen to a 5-year low on Friday.
Overall, the various actions are “the first positive step in the right direction and demonstrates the ability of officials to act in concert, which should provide the euro-dollar with a boost of confidence for the time being,” said Boris Schlossberg, of Global Forex Trading.
And currency strategists at Brown Brothers Harriman wrote that, “Flooding the market with a currency is never good for the exchange rate. However, we continue to believe that the dollar’s bull trend remains intact.”
Source: Dollar Slides Against Euro
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