February 12, 2008	Tuesday	Safar 04, 1429

LONDON, Feb 11: The euro fell against the dollar on Monday with rising risk aversion and a lack of data wiping out earlier gains that came after finance chiefs from rich nations warned of slowing global economic growth.

In late European trade, the euro was at $1.4503, down from $1.4505 in New York late on Friday.

Against the Japanese currency, the dollar fell to 106.71 yen from 107.32.

The single European currency had risen earlier in the day following comments from European Central Bank President Jean-Claude Trichet that there had been no discussion of interest rate cuts at the bank’s meeting last week when rates were left on hold at 4.00 per cent.

But analysts said comments from other ECB officials coupled with signs that economic activity in the 15-nation eurozone is starting to wane meant Trichet’s remarks did little to lower expectations that rates will fall in coming months.

“While Trichet might have been trying to temper rate cut expectations, the less hawkish hue of the ECB last week suggests that the ground work is being prepared for a rate cut,” wrote analysts at BNP Paribas.

Several major European banks, including UBS and Commerzbank, are due to publish results this week which will be closely eyed to see to what extent the subprime losses of US banks are mirrored across the Atlantic.

“Rising risk aversion through greater write-downs would provide support for the dollar against the euro,” said the BNP Paribas analysts.

Ashraf Laidi, currency strategist at CMC Markets, said Wednesday’s release of US January retail sales figures will be key in determining the direction of equity markets this week, which will have a knock-on effect on risk aversion and currencies.

If sales recover after posing a 0.4 percent fall in December then stocks could well receive a much-needed boost.

The dollar had earlier Monday slid against the euro and yen after finance chiefs from the world’s richest nations warned of slowing global economic growth.

G7 finance ministers and central bank chiefs meeting in Tokyo at the weekend warned that the global economy faced growing threats from a US housing slump and squeeze on credit.—AFP