Dollar weakens against other majors in Asian trade
By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — The euro traded close to two-year lows against the U.S. dollar in Asian trading on Monday amid worries about Europe’s outlook, although the greenback gave back some of the gains recorded last week against other major currencies.
The euro EURUSD +0.22% , which dropped as low as $1.2265 in Asia earlier Monday, was fetching $1.2288 in afternoon trading in Hong Kong, from $1.2278 in North America late on Friday, with some analysts warning of further downside for Europe’s common currency.
“The currency market mood is likely to turn more pessimistic this week as investors return their focus to fiscal-policy challenges. In the wake of Fed, [Bank of England and European Central Bank] policy announcements, there now appears little on the monetary-policy front to lift investor sentiments,” Adam Myers, a senior foreign exchange strategist at Credit Agricole, wrote in a note.
“The decision by [People’s Bank of China] policy makers to cut deposit and lending rates for the second time in less than a month appears to have raised, rather than dampened, concerns surrounding global growth outlook,” Myers said.
He said that in the absence of any surprise European fiscal-policy announcement this week, currency markets should shift back convincingly into “risk-off” territory.
The ICE dollar index DXY +0.02% , which measures the greenback’s performance against a basket of six other major currencies, including the euro, edged lower to 83.278, from 83.359 late Friday.
Among other major currency pairs, the British pound GBPUSD +0.08% was fetching $1.5489, up from $1.5482, while the Australian dollar AUDUSD -0.07% was changing hands for $1.0193 slipping from $1.0206.
Against the Japanese currency, the dollar USDJPY +0.05% was unchanged at ÂĄ79.65.
Varahabhotla Phani Kumar is a reporter in MarketWatch's Hong Kong bureau.
