USD strengthens as euro marches on yen

USD strengthens as euro marches on yen

Story link: USD strengthens as euro marches on yen

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In New York on Wednesday, the dollar brought it’s five-day losing streak to an end on news that the US trade deficit was smaller, at $55.4 billion, than had been expected in May. The euro fell to $1.209 in relation to the dollar.

The euro, however, managed to gain on the yen as it settled at ¥135.47 after having reached a six-week high of ¥135.9 earlier in the day. The US dollar also gained on the yen, to ¥112.1 in New York, up from ¥111.1 in trade in Tokyo.

The yen’s continuing weakness reflected figures showing that Japan’s current account surplus had fallen for the seventh month in a row in May, down 19.5 percent from the same month last year.

However, the Bank of Japan still raised its economic forecast for the first time since March.

Weak job data that made an August interest rate cut in the UK more likely sent sterling weaker as analysts predicted an interest rate of 4 percent by the first quarter of 2006. Sterling fell to $1.752 in relation to the US dollar in New York trade.