LONDON, April 16: The dollar came under pressure on Wednesday, particularly against the euro, as dealers fretted over US economic fundamentals despite a series of better-then-expected corporate earnings reports.
The single European currency rose to 1.0833 dollars from 1.0796 late on Tuesday in New York.
The dollar edged up to 120.32 yen from 120.24 on Tuesday.
The US currency’s mixed fortunes came even after a rise in New York share markets overnight, followed later by relatively bullish first-quarter earnings reports from tech giants Intel and Microsoft.
Computer chip maker Intel announced its net profit in the first quarter of 2003 had fallen 2.2 per cent from a year ago, but said its performance remained “solid”, with better-than-expected sales in some areas.
Software colossus Microsoft reported a 2.0-per cent year-on-year increase in net profit for the first three months of 2003, with sales surging 8.1 per cent.
However some currency dealers were less than impressed, remaining concerned over a raft of less positive economic data released in the United States over the week.
Despite the strong performance of the equity market, we believe the cloud of economic uncertainty remains in the US and continues to undermine the dollar, said currency strategist Derek Halpenny of the Bank of Tokyo-Mitsubishi.
The promising earnings results yesterday were somewhat tempered by the cautious outlook by Microsoft. Furthermore, the economic data from the US underlined the continued weakness of the manufacturing sector, he said.
While profits had risen, Microsoft remained cautious, saying that the personal computer industry remained sluggish, due in part to poor consumer confidence.
As Easter approaches, investors are unlikely to take aggressive positions, he added.
The euro was changing hands at $1.0833 from 1.0796 late on Tuesday in New York, 130.37 yen (129.81), 0.6885 pounds (0.6875) and 1.5023 Swiss francs (1.5025).
The dollar was being quoted at 120.32 yen (120.24) and 1.3868 Swiss francs (1.3916).
The pound was at $1.5736 (1.5700), 189.37 yen (189.78) and 2.1825 Swiss francs (2.1848).
On the London Bullion Market, the spot price of an ounce of gold fell $1.70 from the previous closing price to $323.75 per ounce. —AFP
