Euro Falls Against Dollar


The euro fell against the dollar after Luxembourg's Finance Minister Jean-Claude Juncker signaled concern over the U.S. currency's decline.

The euro retreated from a record versus the U.S. currency after Juncker, who heads a group of counterparts from the euro area, told reporters he didn't like ``the way things are developing'' in the foreign-exchange markets. The Australian dollar rose to a 24-year high against the dollar after a government report showed inflation accelerated above 4 percent for the first time in seven years.

The euro weakened to $1.5954 at 7:05 a.m. in New York, from $1.5991 yesterday, when it climbed to $1.6019, the highest since the currency's launch in 1999. The euro slipped to 164.43 yen, from 164.76. The dollar was little changed at 103.07.

France's European Union Affairs Minister Jean-Pierre Jouyet also said today the euro's advance above $1.60 is worrying and urged greater coordination with the U.S., Japan and China to stem its advance. He spoke in an interview on LCI television today.

The 15-nation European currency earlier strengthened against the dollar after an industry report showed growth in Europe's service industries unexpectedly accelerated in April, giving the European Central Bank more reason to keep interest rates on hold.

The euro has risen 2.2 percent in April and 9.4 percent this year against the dollar on speculation inflation will discourage the ECB from lowering its 4 percent main refinancing rate. Inflation accelerated to a 16-year high of 3.6 percent in March, a European Union report showed last week.


TradingEconomics.com, Bloomberg
4/23/2008 6:46:21 AM