19 September 2001, 08:19 Dollar Lower Against Currencies
NEW YORK (AP) - The dollar slipped Tuesday in choppy foreign
exchange trading.
Following the lead of U.S. stock prices, the dollar seemed to
stabilize Tuesday, before giving way to pressure late in the
sesssion. Still, stock price indexes and the dollar both finished
only slightly lower, as investors kept watch on political and
security-related developments.
"Currency markets are running to and fro while they try to
figure out the global security situation, and I think that's going
to define currency movement for at least the next week if not until
the end of the year," said Greg Anderson, financial economist at
FleetBoston Financial. "Any sign of heightened security concern
causes the dollar to sell off."
The Swiss franc, meanwhile, has gained 6 percent on the dollar
since the terrorist attacks on the World Trade Center and the
Pentagon. On Tuesday, it hit record highs against the euro, a cross
Anderson said "isolates the safe-haven componant of Swiss." In
trading Tuesday, the dollar ranged between 159.50 and 162.30 Swiss
francs, finishing the day at 1.5979, down from 1.6045 late Monday.
In late New York trading, the euro was quoted at 92.68 cents, up
from 92.44 cents late Monday. Meanwhile, the dollar was quoted at
117.23 Japanese yen, down from 117.73 yen.
Elswhere, the central banks of Britain and Japan dropped key
interest rates Tuesday to match similar cuts in the United States,
Canada and continental Europe after last week's terrorist attacks.
Tuesday's cuts came as little surprise after the U.S. Federal
Reserve Bank, the European Central Bank, the Swiss National Bank
and Bank of Canada slashed their main rates Monday.
Though seen as positive, the rate cuts carried minimal impact in
currency trading.
"When everybody cuts rates at the same time and there are much
bigger news stories to fill people's minds, the effects are
negligible," Anderson said. "I think that will be what comes out
of this whole round of rate cuts: negliable currency movements."
Earlier, in Asia, currency traders were wary of possible
intervention by Japan's central bank.
Japan's Finance Minster Masajuro Shiokawa told reporters on
Tuesday that Japanese finance authorities are ready to take action
if the yen moves excessively.
On Monday, the Bank of Japan intervened in the currency market,
buying dollars and selling yen to stem the yen's strength.
The dollar also was quoted at 1.5724 Canadian dollars, up from
1.5688. The British pound rose to $1.4684 from $1.4665.
Currencies of the 12 countries participating in the euro are no
longer traded separately and are tied to the euro by a fixed rate.
Based on Tuesday's euro rate, the dollar was worth 2.1105 German
marks, down from 2.1158; 7.0784 French francs, down from 7.0960;
and 2,089.42 Italian lire, down from 2,094.62.
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