Dollar declines vs. major counterparts before U.S. election

‘Uncertainty’ Lingers

“All this uncertainty that continues to linger is proving to be quite damaging for the euro,” said Sonja Marten, a currency strategist at DZ Bank AG in Frankfurt. “It’s difficult to see how we can get out of this quickly.”

Spain said yesterday it is working on a review of income and spending in its welfare system as it heads toward a deficit. The country is relying on European aid for its banks and potentially seeking more to shore up its public finances.

German factory orders fell the most in a year in September, the Economy Ministry in Berlin said today. Orders, adjusted for seasonal swings and inflation, slumped 3.3 percent from August, when they dropped a revised 0.8 percent.

“The euro is being sold as the market focuses on the risks surrounding Greece and Spain,” said Junichi Ishikawa, an analyst at IG Markets Securities Ltd. in Tokyo. “German data have been weakening and there are concerns the country may fall into a recession. You can’t buy the euro in the current environment.”

Aussie Gains

The dollar has gained 0.8 percent over the past month, according to Bloomberg Correlation-Weighted Indexes, which track 10 developed-nation currencies. The euro and yen each declined 1.3 percent.

Australia’s currency rose to a five-week high against the dollar after Reserve Bank of Australia Governor Glenn Stevens and his board left the overnight cash-rate target at 3.25 percent. Twenty of 27 economists surveyed by Bloomberg forecast a cut to 3 percent.

“The RBA was expected to potentially cut rates today and they didn’t,” said Greg Gibbs, a senior currency strategist at Royal Bank of Scotland Group Plc in Singapore. “As a result, the Aussie dollar rallied.”

The so-called Aussie advanced 0.7 percent to $1.0436 after rising to $1.0445, the strongest since Sept. 28. The currency gained 0.6 percent to 83.69 yen.

Bloomberg News

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