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| Version 1 | Version 2 |
|---|---|
| Dollar declines to fresh euro low | Dollar declines to fresh euro low |
| (about 3 hours later) | |
| The dollar has fallen to a fresh all-time low against the euro, as it continues to be knocked by fears over the state of the US economy. | The dollar has fallen to a fresh all-time low against the euro, as it continues to be knocked by fears over the state of the US economy. |
| After more reports of losses in the US banking sector, the dollar touched $1.48 against the euro in mid afternoon trading in Europe. | |
| This was worse than the dollar's previous record low of $1.4752 for one euro, seen at the start of the month. | This was worse than the dollar's previous record low of $1.4752 for one euro, seen at the start of the month. |
| The dollar also weakened against sterling, with one pound worth $2.0639. | |
| On Friday, 9 November, the pound hit $2.1144, its higher level against the dollar since the early 1980s. | On Friday, 9 November, the pound hit $2.1144, its higher level against the dollar since the early 1980s. |
| Rate moves | Rate moves |
| The continuing dollar weakness has been sparked by the US bad mortgage debt crisis, and the knock-on credit squeeze, which has led to a growing number of American banks revealing multi-million dollar losses. | The continuing dollar weakness has been sparked by the US bad mortgage debt crisis, and the knock-on credit squeeze, which has led to a growing number of American banks revealing multi-million dollar losses. |
| The Fed and the money markets are staring each other down and the question is who will blink first Thomson analyst John Noonan | The Fed and the money markets are staring each other down and the question is who will blink first Thomson analyst John Noonan |
| This has weakened the dollar as analysts expect the Federal Reserve to cut US interest rates further when it meets in December in an effort to ease problems in both the housing and credit markets. | This has weakened the dollar as analysts expect the Federal Reserve to cut US interest rates further when it meets in December in an effort to ease problems in both the housing and credit markets. |
| Lower interest rates make the dollar less attractive for currency investors, who instead have been turning to other currencies, such as the euro, pound, Swiss franc, and Japan's yen. | Lower interest rates make the dollar less attractive for currency investors, who instead have been turning to other currencies, such as the euro, pound, Swiss franc, and Japan's yen. |
| "The Fed and the money markets are staring each other down and the question is who will blink first," said Thomson analyst John Noonan. | "The Fed and the money markets are staring each other down and the question is who will blink first," said Thomson analyst John Noonan. |
| The Fed last cut interest rates in October to 4.5%. | The Fed last cut interest rates in October to 4.5%. |
| "Markets have been very sensitive to a bunch of negative news from the US, forcing investors to shun risk and instead hedge their positions," said Hideaki Inoue, chief foreign exchange strategist at Mitsubishi-UFJ Trust. | "Markets have been very sensitive to a bunch of negative news from the US, forcing investors to shun risk and instead hedge their positions," said Hideaki Inoue, chief foreign exchange strategist at Mitsubishi-UFJ Trust. |