LONDON, 4 August 2005 — The dollar drifted further lower against other major currencies yesterday, in what appeared to be an end to its rally through most of the year amid renewed concerns about the twin US deficits.

The euro rose to $1.2338 in late European trading, its highest level, since June 8, from $1.2324 late on Tuesday in New York. The dollar was trading at 111.13 yen against 111.46 yen late on Tuesday.

The re-emergence of concerns about the US deficits, the main factor behind the fall of the dollar throughout 2004, was exacerbated by weaker-than-expected macroeconomic data yesterday.

The euro was changing hands at $1.2338 against $1.2191 late on Tuesday in New York, 137.03 yen (135.88), 0.6931 pounds (0.6885) and 1.5570 Swiss francs (1.5568). The dollar stood at 111.13 yen (111.46) and 1.2618 Swiss francs (1.2769).

On the London Bullion Market, the price of an ounce of gold stood at $434.60 against $431 late on Tuesday.

Meanwhile, European stock markets closed mostly lower yesterday, with the London FTSE 100 index virtually flat, edging up 0.09 percent to 5,332.3 points. In Frankfurt the DAX 30 fell 0.20 percent to 4,923.12, while in Paris the CAC 40 slipped 0.17 percent to 4,495.48.

In New York, US stocks were weaker but off lows yesterday, helped by a retreat from record highs in the price of oil after an unexpected rise in US crude stockpiles, brokers said.

In late morning trade, the Dow Jones Industrial Average was down 11.62 points (0.11 percent) at 10,672.12 and the tech-heavy NASDAQ Composite Index slipped 4.33 points (0.20 percent) to 2,213.82.

Asian stocks closed sharply mixed yesterday. In Tokyo, the Nikkei-225 index gained 41.60 points at 11,981.80, off a high of 12,009.56. In Seoul, the KOSPI index closed down 1.72 points at 1,117.11, off a high of 1,129.92 and a low of 1,116.95. In Hong Kong, the Hang Seng Index closed down 18.58 points at 15,118.50. In Sydney, the SP ASX 200 index opened solidly higher, rising to an intra-day record high of 4,399.2 points before sentiment turned and it dropped to close at the day’s low of 4,368.8, down 16.6 points.

In Singapore, the Straits Times Index dropped 11.94 points to 2,365.19. Volume traded totaled 1.3 billion shares worth 1.5 billion Singapore dollars.