Dollar Falls Versus Euro


The dollar fell against the euro after a government report showed the economy lost jobs for a third straight month in March, increasing concern that the U.S. is falling into a recession.

The currency weakened as futures traders raised bets the Federal Reserve will cut borrowing costs by a half-percentage point at its meeting this month. Chairman Ben S. Bernanke acknowledged this week that the economy may contract in the first half of this year, halting a 1.8 percent rally in the dollar from its record low of $1.5903 per euro touched March 17.

The dollar fell 0.3 percent to $1.5723 per euro at 9:20 a.m. in New York, from $1.5684 yesterday. It dropped 0.3 percent to 101.99 yen, from 102.25. The euro traded at 160.46 yen, compared with 160.37 yesterday.

U.S. payrolls dropped by 80,000 in March after a revised decline of 76,000 in the previous month, the Labor Department said today in Washington. The median forecast of 79 economists surveyed by Bloomberg News was for 50,000 fewer jobs. The jobless rate increased to 5.1 percent from 4.8 percent.

The last time the world's largest economy lost jobs for at least three consecutive months coincided with the start of the Iraq War in 2003.

The U.S. currency posted a fourth weekly drop against the euro on March 7 after the government said the U.S. unexpectedly lost jobs for a second straight month in February.


TradingEconomics.com, Bloomberg
4/4/2008 7:00:21 AM