Euro slips back against dollar
The euro slipped back against the dollar Thursday amid fading hopes for an intervention by Group of Seven policymakers to shore up the ailing currency, dealers said.
Around 2:00 p.m. (0500 GMT) the euro traded at $0.8472, down from $0.8487 in New York but up from $0.8456 in Tokyo late Wednesday.
The euro sunk to a record low of $0.8443 in London Wednesday as a weekend meeting of G7 finance ministers and central bankers loomed.
"Investors will not support the euro unless G7 member nations actually agree to intervene in the market," said Mitsuru Sahara, vice president of Sanwa Bank's foreign exchange division.
Investors were little moved by US Treasury Secretary Lawrence Summers' remarks Wednesday that the United States was monitoring the slumping euro while maintaining its own exchange policies, dealers said.
"In reality, there will be no intervention," said Bank of Tokyo Mitsubishi chief analyst Koji Fukaya, shrugging off speculation that Tokyo and Washington may join a coordinated action by the euro zone countries.
The euro will face a tough time over the next few weeks, the analyst predicted.
"If there is no intervention, the euro may test the 0.80 dollar-level and the 85 yen-level against the yen," Fukaya said.
In Singapore, analysts said a weak business confidence index in Germany also weighed on the euro.
The business climate index for western Germany stood at 99.0 in August, down marginally from 99.1 in July, data published by the Ifo economics research institute showed Wednesday.
The Ifo index measures companies' assessment of their current business, as well as their expectations for the next six months.
"Growth perception matters when it comes to the euro," said research house IDEAGlobal.com.
"This third consecutive weak Ifo reading only cements the fact that euro zone growth is not going to accelerate," the house said.
The euro also bought 90.31 yen, against 90.18 yen here late Wednesday.
The dollar meanwhile was trading at 106.60-62 yen, compared with 106.57 yen in New York and 106.66 yen in Tokyo late Wednesday.— (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)
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