NEW YORK: The dollar fell against the euro, yen and Swiss franc on Wednesday, Nov 17 as the lack of a solution to Ireland's debt crisis weighed on markets.
Stocks were slightly higher to little changed, with Wall Street unable to overcome the prior session's selloff. A late drop in U.S. bank shares offset gains by retailers.
Treasuries prices rose after U.S. government figures showed the lowest core annual inflation rate on record and a steep drop in housing starts from already depressed levels. The data supported the case for the Federal Reserve to buy government bonds to stimulate the economy.
The euro rose as high as $1.3539 and last traded at $1.3521, up 0.21 percent from the prior close. The dollar was down 0.04 percent at 83.23 yen and last traded at 0.9895 Swiss francs, down 0.6 percent.
Tokyo stocks looked set to open down, with December Nikkei futures traded in Chicago off 15 points at 9825.
Euro zone finance ministers have agreed to lay the groundwork for bailing out Ireland's banking sector with the International Monetary Fund. Dublin has yet to decide whether to request the aid.
Nervousness about the debt crisis grew after European clearing house LCH. Clearnet doubled its margin requirement on Irish government bonds to 30 percent of net positions, citing higher Irish yields over German benchmarks.
"If we get a resolution to Ireland's problems, you could see the euro bounce," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington. "The overall bias is to the downside, given uncertainty about not just Ireland but Portugal and Spain."
The euro briefly gained after a report showed U.S. consumer prices rose less than expected in October and the increase in the year-on-year core rate was the smallest on record. But the single currency has lost 3.2 percent this month as investors cut long positions as peripheral debt worries mount.
World markets were also hit by interest rate concerns involving China, the global growth engine. Premier Wen Jiabao said his government was preparing steps to tame price rises.
"Chinese rate hike prospects are one thing (affecting markets). There is also the prospect of tighter measures on inflows in Asia, especially Korea," said Gaelle Blanchard, emerging markets strategist at Societe Generale.
Chinese shares closed down 1.9 percent, sending wider Asian stocks to their lowest levels in four weeks and hitting other countries that depend on China's growth, such as Australia.
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U.S. Treasury debt prices on the short end of the yield curve, the most sensitive to moves by the Fed, were higher on weak consumer price and housing data. Starts on new homes slumped to the lowest in 1-1/2 years in October, the government said.
The 2-year U.S. Treasury note was up 1/32, with the yield at 0.48 percent. But longer-dated Treasuries prices slipped in a late sell-off on uncertainties over the fate of the Federal Reserve's bond program to help the economy.
The benchmark 10-year U.S. Treasury note was down 10/32, with the yield at 2.88 percent and the 30-year U.S. Treasury bond was down 7/32, with the yield at 4.28 percent.
On Wall Street stocks ended little changed, with indexes unable to recoup recent losses as banks wilted on worries about Federal Reserve regulation of the sector going forward.
The Dow Jones industrial average was off 15.62 points, or 0.14 percent, to 11,007.88. The Standard & Poor's 500 Index edged up 0.25 point, or 0.02 percent, at 1,178.59. The Nasdaq Composite Index added 6.17 points, or 0.25 percent, to 2,476.01.
MSCI's all-country world stock index rose 0.17 percent while the FTSEurofirst 300 index of leading European shares advanced by 0.54 percent to 1,092.46.
In energy and commodities prices, U.S. light sweet crude oil fell $1.85, or 2.25 percent, to $80.49 per barrel,, and spot gold prices fell $4.56, or 0.34 percent, to $1335.80. The Reuters/Jefferies CRB Index was down 0.79 points, or 0.27 percent, at 295.43. - Reuters
Stocks were slightly higher to little changed, with Wall Street unable to overcome the prior session's selloff. A late drop in U.S. bank shares offset gains by retailers.
Treasuries prices rose after U.S. government figures showed the lowest core annual inflation rate on record and a steep drop in housing starts from already depressed levels. The data supported the case for the Federal Reserve to buy government bonds to stimulate the economy.
The euro rose as high as $1.3539 and last traded at $1.3521, up 0.21 percent from the prior close. The dollar was down 0.04 percent at 83.23 yen and last traded at 0.9895 Swiss francs, down 0.6 percent.
Tokyo stocks looked set to open down, with December Nikkei futures traded in Chicago off 15 points at 9825.
Euro zone finance ministers have agreed to lay the groundwork for bailing out Ireland's banking sector with the International Monetary Fund. Dublin has yet to decide whether to request the aid.
Nervousness about the debt crisis grew after European clearing house LCH. Clearnet doubled its margin requirement on Irish government bonds to 30 percent of net positions, citing higher Irish yields over German benchmarks.
"If we get a resolution to Ireland's problems, you could see the euro bounce," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington. "The overall bias is to the downside, given uncertainty about not just Ireland but Portugal and Spain."
The euro briefly gained after a report showed U.S. consumer prices rose less than expected in October and the increase in the year-on-year core rate was the smallest on record. But the single currency has lost 3.2 percent this month as investors cut long positions as peripheral debt worries mount.
World markets were also hit by interest rate concerns involving China, the global growth engine. Premier Wen Jiabao said his government was preparing steps to tame price rises.
"Chinese rate hike prospects are one thing (affecting markets). There is also the prospect of tighter measures on inflows in Asia, especially Korea," said Gaelle Blanchard, emerging markets strategist at Societe Generale.
Chinese shares closed down 1.9 percent, sending wider Asian stocks to their lowest levels in four weeks and hitting other countries that depend on China's growth, such as Australia.
BONDHOLDER-FRIENDLY NEWS
U.S. Treasury debt prices on the short end of the yield curve, the most sensitive to moves by the Fed, were higher on weak consumer price and housing data. Starts on new homes slumped to the lowest in 1-1/2 years in October, the government said.
The 2-year U.S. Treasury note was up 1/32, with the yield at 0.48 percent. But longer-dated Treasuries prices slipped in a late sell-off on uncertainties over the fate of the Federal Reserve's bond program to help the economy.
The benchmark 10-year U.S. Treasury note was down 10/32, with the yield at 2.88 percent and the 30-year U.S. Treasury bond was down 7/32, with the yield at 4.28 percent.
On Wall Street stocks ended little changed, with indexes unable to recoup recent losses as banks wilted on worries about Federal Reserve regulation of the sector going forward.
The Dow Jones industrial average was off 15.62 points, or 0.14 percent, to 11,007.88. The Standard & Poor's 500 Index edged up 0.25 point, or 0.02 percent, at 1,178.59. The Nasdaq Composite Index added 6.17 points, or 0.25 percent, to 2,476.01.
MSCI's all-country world stock index rose 0.17 percent while the FTSEurofirst 300 index of leading European shares advanced by 0.54 percent to 1,092.46.
In energy and commodities prices, U.S. light sweet crude oil fell $1.85, or 2.25 percent, to $80.49 per barrel,, and spot gold prices fell $4.56, or 0.34 percent, to $1335.80. The Reuters/Jefferies CRB Index was down 0.79 points, or 0.27 percent, at 295.43. - Reuters
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