Dollar Pares Gains After Senate Approves Bank Rescue Bill

The dollar pared gains against the euro after the U.S. Senate approved a $700 billion bank-rescue bill to ease a global credit crisis.

The U.S. currency earlier advanced against the euro and the yen on increased demand for dollar funding, reflecting the reluctance of banks to lend to each other amid a global credit crunch. The euro traded near a two-year low versus the yen on speculation European Central Bank President Jean-Claude Trichet will say the shortage of credit reduces the need for higher interest rates at a meeting today.

The dollar traded at $1.3991 per euro at 10:48 a.m. in Tokyo, from $1.4009 late yesterday in New York. It earlier rose as high as $1.3937. The currency was at 105.83 yen from 105.71 yen. The euro fell to 148.02 yen from 148.11 yen yesterday and compares with a two-year low of 147.04 yen reached Sept. 16.,
10/1/2008 7:19:52 PM