CURRENCIES: Dollar Slumps Versus Euro As Gold Futures Soar
http://www.djnewswires.com/eu
CURRENCIES: Dollar Slumps Versus Euro As Gold Futures Soar
By Lisa Twaronite
The dollar gained slightly on the yen but retreated against the euro in Asian-hours trading Monday, as soaring gold futures pressured the greenback against its European counterpart.
The dollar bought 90.06 yen, up from 89.88 yen in late North American trade Friday, while the euro rose to $1.4940, up from $1.4840
Gold futures climbed to new heights in electronic trading in Asia, with the most-active December contract tapping an intraday high of $1,105 an ounce, as the market extended gains from Friday's record New York finish.
At the weekend meeting in Scotland of finance ministers and central bankers from the Group of 20 leading economic powers, attendees agreed to keep massive stimulus measures in place until the global recovery strengthens.
In a report to the G20, the International Monetary Fund cited signs that the dollar is being used as a funding currency for carry trades, which involve borrowing funds denominated in lower-interest currencies -- such as the dollar and yen -- and investing in higher-yielding assets denominated in other currencies.
"These trades may be contributing to upward pressure on the euro and some emerging-economy currencies," the IMF said. "The euro has experienced most appreciation among major advanced economy currencies and remains on the strong side of its equilibrium."
On Friday, the dollar had edged lower against the yen and traded nearly flat against the euro, after a surprise jump in the U.S. jobless rate to more than 10% comforted views the Federal Reserve will stick to a loose monetary policy.
Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=MJzxBhF%2FjzBefbmnV8by9Q%3D%3D. You can use this link on the day this article is published and the following day.
(END) Dow Jones Newswires
November 09, 2009 02:09 ET (07:09 GMT)
Copyright 2009 Dow Jones & Company, Inc.
The Dow Jones content is the property of Dow Jones or its licensors, and is protected by copyright and other intellectual property laws. If you are an individual, you agree not to store, copy, reproduce, modify, distribute, transmit, display, perform, publish, transfer, create derivative works from, broadcast or circulate any Dow Jones content to anyone, including but not limited to others in the same company or organization, without the express prior written consent of Dow Jones. If you are an entity, you agree not to permit access to the Dow Jones content by anyone other than an employee of you.
Notwithstanding the foregoing, the Dow Jones content may be copied and sent without charge in the ordinary course of business provided all copyright an
