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20-05-2008, 05:04 PM

Serious investors read Bloomberg and also listen to what the head of the IMF say as well...:

Dollar Declines as IMF Says Risks to Financial System Remain

By Kosuke Goto and Gavin Finch

May 20 (Bloomberg) -- The dollar fell against the yen and euro after the International Monetary Fund said the U.S. housing slump still poses ``serious risks'' to financial markets.

The currency declined against the Swiss franc and British pound before private and industry reports this week that may show the housing market is worsening. The euro gained before a report today that may show German investors grew less pessimistic in May. The Australian dollar rose to its highest level in 24 years after minutes of the central bank's last meeting signaled policy makers considered raising rates.

``The dollar has been coming under pressure versus the euro lately, which could be the start of a new trend,'' said Neil Mellor, a currency strategist at Bank of New York Mellon Corp. in London. ``The financial crisis is certainly not over yet, which will weigh on the dollar. And the euro is being buoyed by the continued hawkishness of the European Central Bank.''

The dollar declined to 103.76 yen at 9:20 a.m. in London, from 104.33 yen late yesterday in New York. The currency slid to $1.5607 per euro from $1.5510. The euro was at 161.92 yen, from 161.81.

``We still see serious risks to global financial stability,'' IMF Deputy Managing Director John Lipsky said in a speech in Tokyo today that was delivered by Daniel Citrin, the IMF's Asia-Pacific deputy director.

Lipsky wrote that some Asian currencies are still undervalued and as a result the dollar is only ``at, or slightly stronger than its medium-term, equilibrium'' against currencies of trading partners after adjusting for inflation.

Home Resales

The yen advanced against the U.S. dollar and the pound after Asian stocks fell for the first time in seven days, prompting investors to curb so-called carry trades and repay cheap loans taken out in the currency. The MSCI Asia Pacific Index lost 0.6 percent, snapping a six-day, 3.7 percent advance.

The yen held gains earlier after the Bank of Japan kept its benchmark interest rate at 0.5 percent. Governor Masaaki Shirakawa told a press conference that inflation risks are rising globally. The Federal Reserve has cut rates seven times since September to 2 percent.

The U.S. currency slipped to $1.9563 against the British pound from $1.9489, and declined to 1.0443 versus the Swiss franc from 1.0533. The Dollar Index traded on ICE futures in New York, which tracks the dollar against currencies of six trading partners, fell to 72.657, from 73.045 yesterday.

U.S. house prices slid 1.3 percent in the first quarter, based on a Bloomberg News survey of economists before the Office of Federal Housing Enterprise Oversight report due May 22. Home resales declined 1.6 percent in April, according to a separate survey before May 23 data from the National Association of Realtors.

20-05-2008, 05:04 PM	#196 (permalink)
bkkandrew Guest Posts: n/a	Serious investors read Bloomberg and also listen to what the head of the IMF say as well...: Dollar Declines as IMF Says Risks to Financial System Remain By Kosuke Goto and Gavin Finch May 20 (Bloomberg) -- The dollar fell against the yen and euro after the International Monetary Fund said the U.S. housing slump still poses ``serious risks'' to financial markets. The currency declined against the Swiss franc and British pound before private and industry reports this week that may show the housing market is worsening. The euro gained before a report today that may show German investors grew less pessimistic in May. The Australian dollar rose to its highest level in 24 years after minutes of the central bank's last meeting signaled policy makers considered raising rates. ``The dollar has been coming under pressure versus the euro lately, which could be the start of a new trend,'' said Neil Mellor, a currency strategist at Bank of New York Mellon Corp. in London. ``The financial crisis is certainly not over yet, which will weigh on the dollar. And the euro is being buoyed by the continued hawkishness of the European Central Bank.'' The dollar declined to 103.76 yen at 9:20 a.m. in London, from 104.33 yen late yesterday in New York. The currency slid to $1.5607 per euro from $1.5510. The euro was at 161.92 yen, from 161.81. ``We still see serious risks to global financial stability,'' IMF Deputy Managing Director John Lipsky said in a speech in Tokyo today that was delivered by Daniel Citrin, the IMF's Asia-Pacific deputy director. Lipsky wrote that some Asian currencies are still undervalued and as a result the dollar is only ``at, or slightly stronger than its medium-term, equilibrium'' against currencies of trading partners after adjusting for inflation. Home Resales The yen advanced against the U.S. dollar and the pound after Asian stocks fell for the first time in seven days, prompting investors to curb so-called carry trades and repay cheap loans taken out in the currency. The MSCI Asia Pacific Index lost 0.6 percent, snapping a six-day, 3.7 percent advance. The yen held gains earlier after the Bank of Japan kept its benchmark interest rate at 0.5 percent. Governor Masaaki Shirakawa told a press conference that inflation risks are rising globally. The Federal Reserve has cut rates seven times since September to 2 percent. The U.S. currency slipped to $1.9563 against the British pound from $1.9489, and declined to 1.0443 versus the Swiss franc from 1.0533. The Dollar Index traded on ICE futures in New York, which tracks the dollar against currencies of six trading partners, fell to 72.657, from 73.045 yesterday. U.S. house prices slid 1.3 percent in the first quarter, based on a Bloomberg News survey of economists before the Office of Federal Housing Enterprise Oversight report due May 22. Home resales declined 1.6 percent in April, according to a separate survey before May 23 data from the National Association of Realtors.