LONDON, Feb 24: The dollar's brief rally against the euro was cut short on Thursday, with the US currency slipping as markets prepared for the release of key American economic data, dealers said.
The euro rose to $1.3252 from 1.3205 late on Wednesday. The dollar stood at 104.93 yen from 104.84 on Wednesday. The dollar remains under pressure and is now considered to be in the early stages of resuming another leg of cyclical weakness, Commerzbank economist Patrick Bennett said.
Markets were awaiting the release of US durable goods orders for January and weekly US jobless claims. The dollar may come under further pressure today (Thursday) on the back of a weaker than expected data flow, HBOS economist Steve Pearson said.
The dollar had briefly rebounded against the euro on Wednesday after South Korea's central bank denied it planned to sell-off some of its huge dollar reserves. The US currency had tumbled Tuesday on reports that the South Korean central bank had announced plans in parliament to divest some of its vast dollar reserves, which total over $200 billion.
However, Kang Sun-Sam, a deputy director handling foreign reserves at the central bank, later scotched talk of a dollar sell-off. Expectations of continued US interest rate hikes to counter inflation have helped to support the dollar despite concerns over the massive US current account and budget deficits.
The euro was changing hands at $1.3252 against 1.3205 late on Wednesday in New York, 139.03 yen (138.46), 0.6955 pounds (0.6922) and 1.5388 Swiss francs (1.5371). The dollar stood at 104.93 yen (104.84) and 1.1614 Swiss francs (1.1641).
The pound was at $1.9053 (1.9072), 199.92 yen (199.92) and 2.2125 Swiss francs (2.2202). On the London Bullion Market, the price of an ounce of gold stood at $434.90 against $432.60 late on Wednesday. -AFP
