Dollar tumbles as euro rallies after Portugal bond auction

08:19, January 13, 2011      

Email | Print | Subscribe | Comments | Forum 

The U.S. dollar fell against major currencies in late New York trading on Wednesday as the euro rose, following the Portugal bonds' successful auction.

Portugal sold 1.249 billion euros in government bonds on Wednesday, at the top end of its indicative offer, with yields falling slightly on 10-year bonds on offer but rising on the four- year bonds.

The Portuguese debt agency said, demand exceeded the offer in the four-year bond by 2.6 times and by 3.2 times in the 10-year maturity.

Stimulated by the satisfying auction result, the euro rallied strongly above 1.31 against the dollar in late New York trading session on Wednesday.

Some analysts believed there might be a little bit of a relief rally for the euro, however, some other analysts said the auction results would do little to change the view that the government in Lisbon would continue to struggle and might turn to the European Union and the International Monetary Fund for a bailout.

Attention now turns to Spain and Italy, which will sell debt in auctions on Thursday, which will also be closely watched for signs of contagion.

The Fed said in its newly released Beige Book on Wednesday that the U.S. economy expanded in November and December due to holiday season spending and increased manufacturing. Stocks and commodity markets were lifted by optimism, and the dollar fell against other major currencies in Wednesday's trading.

The dollar slipped to below 83 against the Japanese yen, while the British pound climbed to nearly 1.58 against the dollar in late trading session on Wednesday.

In late Wednesday trading, the dollar bought 82.90 Japanese yen, comparing with 83.27 late Tuesday, and the euro rose to 1.3132 dollars from 1.2970.

The British pound also rose to 1.5767 dollars from 1.5600. The dollar fell from 0.9735 to 0.9671 against Swiss francs, and also fell to 0.9879 Canadian dollars from 0.9910.

Source: Xinhua
  • Do you have anything to say?


Special Coverage
  • Focus On China
  • Shanghai World Expo 2010
Major headlines
Editor's Pick
  • Trade volume of E. China's Yiwu reaches 45.606 bln yuan
  • NBA: Clippers end Heat's win streaks
  • Wild giant pandas spotted again in Mian'ning, Sichuan
  • Memorial service for mass shooting victims held in Tucson
  • Death toll rises to 10 in central China hotel fire
  • Amazing scenery of frozen waterfall in E. China
Hot Forum Dicussion