Dollar Drops on Weak data and U.S. Bailout Uncertainty
The U.S. Dollar dropped today, hurt by investors’ persistent uncertainty about whether or not the U.S. Federal Government’s bail out plan of $700 billion will be effective in mopping up bad bank debt; the drop was furthered along by disappointing U.S. economic data released today.
Despite two days of testimony on Capital Hill by top bank officials, U.S. law-makers seem to be moving towards approval of the deal which is designed to rescue the American banking and financial system. Investors, however, remain concerned that the deal, once approved, will not be successful and have a major detrimental impact on the U.S. economy. Also, of major concern, is how the deal will affect the U.S. government’s coffers.
U.S. economic data released today showed worse than expected jobless claims, and lower durable goods orders for the month of August.
In early morning trading on the New York exchange, the U.S. Dollar fell .5% against the basket of currencies, trading at 76.603 on the I.C. Exchange’s Dollar Index. Meanwhile, the Euro traded at $1.4695, up .6% against the U.S. Dollar. The U.S. Dollar lost ground against the Japanese Yen, trading at 105.81 Yen, a decrease of .4%.