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Dollar Gains against Yen, Euro, Pound

July 14, 2008 at 10:54 by Andriy Moraru

U.S. dollarThe U.S. dollar showed the first daily growth against the euro in last four trading days after the U.S. Treasury Secretary Henry Paulson announced the government’s funding plans for the failing mortgage lending giants Freddie Mac and Fannie Mae.

The dollar also rose against the other major currencies, including Japanese yen and British pounds, after the arrival of the news that Paulson asked the U. S. Congress to buy stakes in both Freddie Mac and Fannie Mae to help them to restore after the crisis.

Federal Reserve will also offer those companies loans at a discount rate in order to supply them with the additional liquidity.

Short-term currency speculators are now restoring the dollar’s position after they sold this currency last week. News that the U.S. government is help the whole financial system through the Freddie Mac and Fannie Mae buy-out will draw more attention to the dollar.

EUR/USD dropped from 1.5961 to 1.5864 today as of 8:44 GMT with a daily low near 1.5841. GBP/USD also declined significantly today — it went down from 1.9910 to 1.9823 with the minimum at 1.9814. USD/JPY showed a moderate growth — it rose from 106.13 to 106.71 today.

If you have any questions, comments, or opinions regarding the US Dollar, feel free to post them using the commentary form below.

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