Dollar Extends Gains as Traders Square Bets

The dollar rose to a 10-week high against the pound and climbed to a six-week peak against the euro on Monday, extending its strong run following forecast-beating US economic data last week.

Both US inflation and retail sales figures came in ahead of forecast, damping expectations that the Federal Reserve would deliver a series of aggressive cuts in US interest rates.

The dollar rose 0.5 per cent to $1.4340 against the euro, climbed 0.2 per cent to $2.0130 against the pound and 0.2 per cent to SFr1.1560 against the Swiss franc.

The euro was undermined by survey data showing the eurozone purchasing managers’ index for both the manufacturing and services sectors lost ground in December.

Financial Times
12/17/2007 6:37:15 AM