Dollar falls amid European optimism, economy concerns

2011-10-13 15:38:16

The U.S. dollar fell against most major currencies in late New York trading on Wednesday as optimism rose on the expansion of euro zone bailout fund and the Federal Reserve's minutes showed U.S. economy faces downside risk, Xinhua informed.
Slovakia's political parties on Wednesday reached an agreement that will allow the countries'parliament to approve enhancements to the euro zone's 440 billion euro bailout fund. The news helped raise investors'confidence on the euro. The shared currency rose more than 1 percent against the dollar on Wednesday.
Meanwhile, the minutes of the Fed's Sept. monetary policy meeting showed that Fed members saw "significant downside risks" to growth. These risks included household deleveraging, bigger- than-expected fiscal tightening, or a potential spillover from Europe.
The minutes also showed that disagreements still existed among Fed's members as two Fed officials wanted more aggressive measures rather than Operation Twist, which kept the Fed's balance sheet unchanged.
The dollar was under pressure amid the euro's strength and concerns about the U.S. economy. The dollar index lost 0.84 percent to 76.93.
The Britain's Office for National Statistics reported that the total number of British unemployed rose 114,000 to 2.57 million in the three months ending in August, the highest total since the three months ending in Oct. 1994. however, the British pound managed to rise against the greenback.
In late Wednesday trading, the dollar bought 77.30 Japanese yen, comparing with 76.66 from late Tuesday. The euro rose to 1.3793 dollars from 1.3688.
The British pound also rose to 1.5762 dollars from 1.5594. The dollar fell from 0.9072 Swiss francs to 0.8944, and also fell to 1.0147 Canadian dollars from 1.0299.