Euro prolongs recovery against dollar | The Daily Star
12:00 AM, August 29, 2008 / LAST MODIFIED: 12:00 AM, August 29, 2008

Euro prolongs recovery against dollar

The euro gained further against the dollar Thursday on market speculation that eurozone interest rate cuts are unlikely in the near future, dealers said.
In morning London deals, the European single currency rose to 1.4765 dollars from 1.4737 in New York late on Wednesday.
Against the Japanese currency, the dollar dropped to 109.08 yen from 109.47.
The euro climbed further away from six month lows of below 1.46 dollars, reached on Tuesday in the wake of downbeat consumer confidence and business sentiment surveys in Germany, Europe's biggest economy.
"Anticipation of a quick rate cut by the ECB now seems to be fading on the back of comments by bank members and this has helped lift the euro away from recent dollar lows," said CMC Markets analyst James Hughes.
The euro has been buoyed by comments from European Central Bank policymaker Axel Weber, who indicated the bank was unlikely to lower interest rates any time soon.
Up to now, markets have been expecting rate cuts from the ECB and hikes from the US Federal Reserve to narrow the rate differential in the two regions.
The dollar was also being pressured by a fresh rise in oil prices on concerns that Tropical Storm Gustav could hit oil and gas installations in the Gulf of Mexico, dealers said.
Market players were looking ahead to another batch of US economic indicators, including second-quarter economic growth and a home price survey due Thursday.
Dealers said the greenback could get a boost from the snapshot of economic second-quarter growth amid hopes it would be revised upwards from an earlier estimate of 1.9 percent.

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