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Dollar hits fresh low against euro - Russkies will sell
The US dollar fell to a fresh low against the euro on Tuesday, breaching the $1.31 barrier for the first time. The cataylst was a hint from the Russian central bank that it plans to step up its policy of switching its foreign exchange reserves into euros, at the expense of the dollar... Russia, which had a record $113.1bn of foreign reserves as of November 12, is already believed to hold some 25-30 per cent of these reserves in euros, with the bulk of the rest in dollars... More importantly, the Russian comments highlighted the prospect of Asian central banks with larger reserves following suit. China has an estimated 80 per cent of its $515bn of reserves in dollars, while Middle Eastern central banks were rumoured to be selling dollars and buying sterling on Tuesday... The upshot was that the dollar fell as low as $1.3105 against the euro, before moderating to $1.3097 by mid-session New York trading, a fall of 0.5 per cent on the day. The greenback also fell 0.6 per cent to a fresh eight-year low of SFr1.1564 against the Swiss franc, 0.7 per cent to a nine-month low of A$0.7877 against the Australian dollar, 0.7 per cent to a four-month low of $1.8726 against sterling and 0.9 per cent to a seven-month low of Rbs28.49 against the rouble itself. However the dollar held its own against Asian currencies, which were undermined by rising oil prices, fresh intervention from South Korea, renewed speculation that the Bank of Japan may return to the market today and comments from Li Ruogu, the deputy governor of the People's Bank of China, in yesterday's FT that suggested a renminbi devaluation was not imminent... Soros' and the arabs revenge??? Posted by: anonymous2u 2004-11-24 |
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