Dollar hits bottom, and then falls again

[*jr]

Source: Bloomberg, IHT

Dollar hits bottom, and then falls again

Bloomberg News, International Herald Tribune, Reuters, The Associated Press


The dollar fell sharply Friday, reaching a record low against the euro and capping a dramatic week for global financial markets that was marked by interest rate cuts, bank bailouts and skyrocketing oil prices.

The level of the dollar - often regarded as a barometer of the U.S. economy's health - dropped to $1.4120 against the euro during business hours in Asia, reaching an all-time low for a second consecutive day.

It also slipped against a number of other major currencies on speculation that the U.S. Federal Reserve would keep cutting interest rates as the world's largest economy weakens.

Sentiment soured for the dollar after Ben Bernanke, chairman of the Federal Reserve, stoked speculation that he might continue to lower rates following this week's aggressive trim of half a percentage point. Bernanke said Thursday that the sell-off in credit markets could make the housing recession more severe.

The dollar recovered somewhat during European trading, but investors believe that the currency will continue to lose ground, as it has for much of the past six years.


Read more: http://www.iht.com/articles/2007/09/21/news/econ.php