Dollar Falls

The dollar dropped for the first time in three days against the euro as the U.S. unemployment rate climbed to the highest level since 1994, indicating the financial crisis is taking a sustained toll.

The yen fell against the euro, the dollar, the Australian dollar and New Zealand's currency as a rally in global stocks on the prospect of further interest-rate cuts by the Federal Reserve encouraged investors to buy higher-yielding assets financed by low-cost loans in Japan.

The dollar depreciated 0.3 percent to $1.2758 per euro at 3:10 p.m. in New York, from $1.2715 yesterday, and was headed for a weekly loss of 0.2 percent. The dollar gained 0.4 percent to 98.15 yen from 97.75. The 15-nation euro increased 0.7 percent to 125.10 yen from 124.29.

Canada's dollar was headed for a 2.1 percent weekly gain against the greenback after the government reported that the nation's employers unexpectedly added jobs in October. The loonie rose 0.9 percent to C$1.1876 per U.S. dollar today.

The yen depreciated 1.8 percent to 66.23 against the Aussie and 0.9 percent to 57.83 versus New Zealand's dollar as stock gains boosted carry trades, in which investors get funds in a country with low borrowing costs and buy assets where returns are higher. Japan's 0.3 percent target lending rate compares with 5.25 percent in Australia and 6.5 percent in New Zealand.,
11/7/2008 1:14:57 PM