Ongoing concerns about Argentina and the strength of the U.S. economy has weakened the dollar a bit today, as traders are moving money away from the Americas into the euro and other world currencies.
This morning, U.S. Treasury Secretary Paul O'Neill said the Bush Administration didn't plan to alter the "strong dollar policy," and the secretary said the current exchange rate was the right one, based on fundamentals. O'Neill has been criticized by those who believe he would consider weakening the dollar to help certain U.S. manufacturing indices.
Lately, the euro traded at $0.8792, rising from yesterday's $0.8735 close. The pound was also stronger against the dollar, rising to $1.4288 from $1.4224 yesterday.
In Europe, Bundesbank President Ernst Welteke said today that he was optimistic about an economic recovery in Germany, despite a survey yesterday, which showed another decline in business sentiment in the largest European economy.
The yen was also stronger against the dollar. Dollar/yen fell to 123.92 today from 124.85 yesterday. Bank of Japan Deputy Governor Sakuya Fujiwara said overnight that the BOJ's policy will not extend to weakening the yen in order to spur economic growth. The comments reiterate the current stance taken by Prime Minister Masaru Hayami. The euro was stronger against the yen today, rising to 109.03 from 108.29.