LONDON, 28 September 2005 — The dollar rose sharply higher yesterday, boosted by expectations of more US interest rate hikes, reaching the highest level against the euro in two months and a 10-week gain against the yen.
In late trading, the euro slid to 1.2012 dollars from 1.2070 late on Monday in New York. The dollar stood at 113.22 yen from 112.12 yen on Monday.
The yen tumbled to its lowest level since July 20 against the dollar, at 113.37 yens, and the pound fell to the lowest since Aug. 1 against the US currency, at $1.7640.
Earlier yesterday the euro dropped as low as $1.1992 — the lowest since July 27 — but gained slightly following an improvement in German business sentiment that took analysts by surprise. The euro was changing hands at $1.2012 against $1.2070 late Monday in New York, 136.07 yen (135.37), 0.6797 pounds (0.6785) and 1.5575 Swiss francs (1.5565).
The dollar stood at 113.22 yen (112.12) and 1.2963 Swiss francs (1.2891). The pound was trading at 1.7676 dollars (1.7785), 200.13 yen (199.50) and 2.2912 Swiss francs (2.2891). On the London Bullion Market, the price of an ounce of gold stood at $464.10 from $461.50 late on Monday.
Meanwhile, European stock markets fell back on profit taking amid a weak batch of US economic data that also dragged Wall Street lower in early trades. In London, the FTSE 100 index slipped 0.11 percent to 5,447.3 points while the Frankfurt DAX 30 shed 0.65 percent to 4,965.88 and in Paris the CAC 40 lost 0.44 percent to 4,546.80.