By: Barbara Zigah
The U.S. Dollar rose to a 2½ month peak against the Euro in New York trading today, as persistent worries about sovereign debt in the Eurozone put pressure on the common currency. As reported at 9:54 a.m. (EST) in New York on the EBS trading platform, the U.S. Dollar rose against the Euro to $1.2969, the highest trade since mid-September before retreating to $1.2977, still 1% higher.
The U.S. Dollar Index, which measures the greenback’s strength against major currencies of which the Euro is one, struck a 2-month peak of 81.444 .DXY, supported by recently released evidence of an improved American economy and investor risk aversion.
Consumer confidence levels in the U.S. have also improved according to a recent survey, coming in slightly higher than had earlier been forecast, which bodes well for the economy in general. American retailers are certainly hopeful that this past weekend’s Black Friday shopping, which was marginally better than the same period a year ago, will establish a trend for the remainder of the holiday season.
The U.S. Dollar is also benefitting heavily from the continuing saga in the Eurozone. Persistent and escalating concerns over Portuguese and Spanish debt are wreaking havoc on the common currency.
Many analysts believe that both Portugal and Spain will eventually have to seek assistance from the IMF/E.U. entity that was established to bailout the troubled nations. Given the fiscal uncertainty there, and the threat of violence in Asia, investors are turning to the U.S. Dollar as the safe-haven currency, in spite of the troubles in the American economy.