U.S. Dollar Slips versus Euro in Quiet Trading

By: Barbara Zigah

In somewhat subdued trading in New York, the U.S. Dollar slipped against the common currency Euro as demand from Latin America and the Eastern European bloc helped to boost the Euro. Investors appear unwilling to take on any large positions as the year draws to a close, and ahead of this week’s meeting of the Federal Reserve and a 2-day summit for leaders of the European Union. As reported at 9:31 a.m. (EST) in New York, the U.S. Dollar was trading against the Euro at $1.3313, down from yesterday’s New York close of $1.3228.

At the E.U. summit, it is widely expected that the members will amend the current E.U. treaty in order to allow Portugal to seek bailout funds, should it decided to do so. One controversial issue that will also likely be raised, yet not on the official agenda, is the proposal that new bonds be issued jointly, on behalf of all of the Eurozone members; however, Germany has vociferously opposed such a proposal, and given that it is the dominant economy among all of the Eurozone nations, it’s quite likely the proposal will be shelved.

Tomorrow, the U.S. Federal Reserve will meet to determine the effectiveness of the latest quantitative easing stimulus. Analysts are not predicting any change to their current plan, however, given the general overall softness in the U.S. Dollar.