The dollar rose versus its major rivals Monday as global
investor sentiment sank deeper, with a decline in U.S. stocks and following a World Bank report that said global growth will contract in 2009 for the first time since World War II. The World Bank statement, released Sunday, is the latest kernel of disappointing news to lean against
investor sentiment, but the pile has been mounting for months. The upshot has been a strengthening dollar on its status as a safe haven.
The Dow Jones Industrial Average declined 80 points Monday. The U.K. pound came under particular pressure Monday, falling to a six-week low of $1.3747 off the Bank of England's quantitative easing plans and after the U.K. government announced it would take a majority
stake in Lloyds Bank through the Asset Protection Scheme. The yen also neared the four-month low it had struck versus the dollar last Thursday. The dollar rose to Y99.19, off the high of Y99.69, on data that showed Japan posting its first current-account deficit in 13 years.
The Australian dollar and Canadian dollar also tumbled against the greenback. The
Australian dollar fell to a three-session low of $0.6311 from $0.6429 late Friday. Meanwhile, the U.S. dollar advanced to a four-year high of C$1.3065 after breaking through key technical trading levels. Monday afternoon, the euro was at $1.2602 from $1.2641 late Friday. The dollar
was at Y98.82 from Y98.27 late Friday. The euro was at Y124.55 from Y124.21. The U.K. pound was at $1.3792 from $1.4066 Friday. The dollar was at CHF1.1595 from CHF1.1597.
The euro was little changed from its levels Friday. Pressure remains on the common currency from its exposure to Eastern and Central Europe. However, European Central Bank governing council member Ewald Nowotny said Monday that euro-zone accession rules will not be eased to aid Eastern and Central Europe nations.
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