Dollar Gets Stronger
US jobs data, in its month’s publication on Friday, declares the Dollar getting stronger while the Euro stayed firm. The European single currency went up from $1.4155 to $1.4156 in New York last Thursday.
While the dollar climbed to 83.68 from 83.20, the Euro stayed strong at 118.67 yen for ten months.
“The situation on the US labour market should be the most likely indicator of when the Fed will finally abandon its ultra-expansionary monetary policy,” said Ulrich Leuchtmann, Commerzbank analyst.
Western central banks are considering raising their interest rates from low levels due to the rising commodity prices that fuel global inflation. On the other hand, the European central bank is expected to raise its borrowing costs by next week while the Federal Reserve and Bank of England are planning to do the same in the coming months.
“The euro remains stable (against the dollar) following the fifth attempt by the Irish government to draw a line in the sand in regard to the recapitalization of the Irish banking sector, which certainly looks more credible than previous attempts and has been given the explicit backing of the ECB,” said the European head of global currency research at The Bank of Tokyo-Mitsubishi UFJ, Derek Halpenny.
The Central Bank of Ireland stated that four lenders would need to raise another 24 billion euros after it conducted stress tests on its ability to stand against another financial crisis. The rest of the capital will be taken from the 35 billion euros intended for banks as part of Ireland’s 85-billion-euro debt rescue agreement in November. This was between the European Union and the International Monetary Fund.
It is feared that the next to bail out will be Portugal following Greece and Ireland that did last year.
Last Friday in London, the Euro closed at $1.4156 against $1.4155 in New York. In Yen, it is 118.51, 0.8842, and in Swiss Francs is 1.3054.
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Source: http://au.finance.yahoo.com/news/Dollar-higher-US-jobs-data-afp-4179981950.html
