Dollar up in Commodity Unwind


The dollar rallied on Thursday as investors took profits from oil, gold and other commodities, repatriating their cash back into the beleaguered U.S. currency ahead of the Easter break.

Oil was down almost 4 percent, dipping below $100 a barrel, gold flirted with its biggest weekly loss in a quarter of a century, and platinum was well on track for its steepest weekly decline in over 20 years.

As investors slashed their "long" exposure to these assets, they covered "short" positions in the dollar, lifting the currency up from historic lows charted earlier this week.

The dollar also gained 1 percent against the yen to 99.70 yen and bounced a healthy 1.6 percent versus the Swiss franc to 1.0125 francs.

With interest rates of just 2.25 percent -- the second lowest among major economies -- and set to fall further, the U.S. currency's upside potential may be limited.


TradingEconomics.com, Bloomberg
3/20/2008 7:41:18 AM