The euro flirted with the $0.90 threshold for the first time in more than three months Friday, December 15, rising strongly against the dollar which was further weakened on Wall Street.
At 2200 GMT, the single European currency traded at $0.8947 in New York, up from $0.8925 a day earlier. It rose as high as $0.8999 in European trading.
Analysts said the euro was cashing in on the continued weakness of the dollar, which was being sapped by fears of an economic slowdown in the United States and a protracted sell-off on Wall Street.
Analysts said the dollar could conceivably struggle until the US Federal Reserve moved to cut interest rates, which could cut the economy some slack and allow corporate giants, which have issued a spate of profit warnings recently, to breathe easier.
"In a way, you need to see some sort of prompt action from the US Federal Reserve" to cut interest rates, said SG global strategist Dhaval Joshi. "The danger is if they don't act quickly enough you could see this slowdown continuing and becoming excessive."
"You are seeing even companies like Microsoft starting to issue weaker earnings announcements which means we are in uncharted territory," he said.
In late New York trade, the dollar was at 112.60 yen against 112.06 in New York Thursday and 1.6820 Swiss francs against 1.6864.
The pound sterling traded at $1.4750 compared to $1.4755.— (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)
