The U.S. Dollar rose versus most major currencies today as worldwide share prices dropped lower due to concerns about a possible recession in major countries.
A key interest rate cut by Japan’s central bank helped stocks, following key rate cuts by the Federal Reserve Bank of the United States and the Central Bank of China this week in order to mitigate the economic damage caused by the crisis.
European shares fell by 1% following a 5% fall by Japan's Nikkei stocks average as investors were not convinced that the Bank of Japan’s 20 basis point interest rate reduction would do much to prevent the economy from slowing down.
Investors’ concerns about global recession and the liquidity crisis lower share prices. The Nikkei recorded a 24% percent fall this month, the biggest fall ever, while European shares appears to be on the way to record their worst monthly performance on record.
According to Tom Levinson of ING, forex markets are still “very jittery.” He reports that the strongest performers over the past day continue to be the U.S. Dollar and Swiss Franc, but primarily the Japanese Yen.
On October 31, 2008 at 11:28 GMT, the Euro fell by 1% to $1.2769; it dropped by 1.9% against the Japanese Yen to 124.95 yen.