The dollar is doing its best

Robert DeNiro

impression today, following his Jake LaMotta mantra, "So gimme a stage, where this bull here can rage."

The stage is the forex markets, and the dollar is fiery today. Making strong gains across the board, the dollar is setting long-term highs against most major currencies. But why's the dollar so strong today? "There's no particular reason," said Anne Parker Mills, senior economist of foreign exchange at

Brown Brothers Harriman


"There's a lot of reasons why the yen is so weak," said Mills, referring to the ongoing demise of the Japanese economy, "but there's not much to explain why the euro is so weak."

The yen has been on a steady downfall for several months. It has recently accelerated its devaluation as both the economy and the political situation in Japan worsen. Prime Minister

Yoshiro Mori

has been largely blamed for the ailing financial situation, and may step down from his post at any time. On Wednesday, international rating agency


put 19 Japanese banks on negative review. The situation looks grim.

And so the yen has reason to fall. It may be "Japanese investors selling, or on concerns about Japanese investors selling," Mills said, but the picture is a little muddy today. The dollar hit new 22-month highs against the yen earlier today, most recently trading at 122.75 yen per dollar, up from yesterday's close of 122.39 yen.

Earlier today, economic spokesman for the European Commission,

Gerassimos Thomas

said, "There is not a specific or conclusive explanation about this," referring to the sharp fall in the euro against the dollar.

The dollar set new three-month highs vs. the euro this morning. The euro was most recently trading for $0.8949, down from yesterday's close of $0.8982.

Meanwhile, trading in euro/yen has remained in a very tight range, little off from yesterday's close. The euro was most recently trading for 109.82 yen, only slightly below Thursday's close of 109.87 yen.

Several other currencies are also getting left in the dust by the zooming dollar: The Australian dollar is still mired near all-time lows against the U.S. currency, while the Canadian dollar dropped to a two and a half year low against it.

"There just seems to be a general move into U.S. dollars," Mills said.

The Australian dollar has been sinking recently as the global economic slowdown, particularly in Asia, has carried over to its own domestic economy. Weak economic data continues to hold the Aussie buck down against the U.S. dollar. The Aussie currency was most recently trading for $0.4936, up slightly from yesterday's close of $0.4917.

The Canadian dollar has little reason for its massive lows today, according to Mills, but for the overall strength of the U.S. dollar. The U.S. dollar was recently trading at C$1.5651, up from $1.5593, where it closed trading yesterday.

The dollar also rocketed to a three and a half month high against the British pound. Sterling is likely falling due to its close ties with the European single currency, a little punch drunk at $1.4315 , down from $1.4344 where it closed trading yesterday.

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