Bernanke testimony sends dollar lower versus euro

Story link: Bernanke testimony sends dollar lower versus euro

The US dollar fell slightly in relation to the euro on Wednesday after early gains after a private report said that 8,000 new jobs were created in the United States in March.

The declines came after Federal Reserve Chairman Ben Bernanke said in testimony before the Congressional Joint Economic Committee that it is possible that the nation’s Gross Domestic Product could contract “slightly” in the first half of 2008 and that if the GDP does grow, it will not be by much.

The greenback traded at $1.5622 to the euro at around noon in New York while the dollar gained slightly on the yen to ¥102.8200 but was lower versus the Norwegian krone, to kr5.1561 to the dollar, after oil prices rose.

The pound was stronger versus both the euro and the dollar on the news that home-loan approvals were down less than had been expected in March, leading to less of a chance that the Bank of England will cut interest rates this month.

At noon in New York, the pound traded at 78.79p to the euro after rising as high as 78.53p earlier, while the pound traded at 50.43p to the dollar.

The rand gained on the greenback and the euro on gains in gold prices and after it was reported that consumer borrowing has declined in South Africa, putting less pressure on the central bank there to raise interest rates when it next meets on April 10.

The rand was trading at R7.8025 to the greenback at noon in New York while it was at R12.189 to the euro at the same time.