U.S. dollar rebounds on central banks’ measures
March 12, 2008 – 4:11 amvia China.com
The U.S. dollar rebounded across the board Tuesday after the U.S. Federal Reserve and other central banks announced new measures to inject liquidity into stressed financial markets.
The dollar had slumped to a new low against the euro during the session on the report that German investor confidence jumped in March.
But the greenback regained lost ground after the U.S. Federal Reserve, the European Central Bank and the Bank of England announced they were joining with other central banks to provide more relief in the credit crisis.
The Fed said it will lend primary dealers up to 200 billion dollars in Treasury securities and allow them to use agency and mortgage debt as collateral.
The announcement cooled market expectations for a sharp interest rate cut at the Fed’s policy meeting later this month, which helped take some pressure off the dollar.
The euro fell to 1.5319 dollars in late New York trading, retreating from a record high of 1.5495 dollars. It had bought 1.5352 dollars late Monday.
Meanwhile, the British pound fell from 2.0101 dollars to 2.0029 dollars.
