The U.S. Dollar gained slightly in choppy trading today despite investors’ concerns about uncertainties regarding the survival of Lehman Brothers and the overall problems of the impact of the US financial sector on the global economy. Lehman Brothers recorded a loss in the third quarter and desperately looking for additional capital to support its operations.
Lehman Brothers share plunged almost 45% yesterday as investors are concerned about its capital and liquidity situation. The company lost $5.92 per share and slashed dividends.
According to Mathew Strauss of RBC Capital Markets, "The Yen's reaction was very telling: we had initial risk aversion favoring Yen trade, but the strong (U.S.) Dollar theme continues to dominate." America’s financial problems are not limited to America, and it appears that the financial problems in the States will soon spread globally.
In early trading in New York, the U.S Dollar was up by 0.6% to 107.44 Yen. The Euro increased slightly by 0.3% to 151.70 Yen. In a volatile session, the Euro trended lower against the U.S. Dollar, and most analysts attribute it to the safe-haven retreats. The Euro traded at $1.4121.
The ICE Futures of the U.S. Dollar index, a measure of the Dollar’s value versus six major currencies, increased by 0.1% to 79.480 DXY.
U.S. Dollar Gains despite Lehman Q3 Loss
DailyForex.com