The dollar rose against most major currencies on Thursday as U.S. Senate approved a financial bailout plan and European Central Bank President Jean-Claude Trichet said inflation risks in the euro zone have diminished.
The measure was passed by a vote of 74 to 25 after more than three hours of floor debate in the Senate on Wednesday night. Besides 700 billion U.S. dollar bailout in the original plan, the bill includes tax breaks for businesses and the middle class and increases deposit insurance. The changes are intended to attract more votes in the House who are expected to take up the Senate measure for a vote on Friday.
The European Central Bank decided on a Thursday meeting to leave its main lending rate unchanged at 4.25 percent. Inflationary pressures in the euro zone "have diminished somewhat but they have not disappeared," Trichet told a conference after the meeting. Analysts took it as a signal that the bank could cut rate soon.
Gains of dollar were partly offset by weak U.S. economic data, sending the greenback lower against the Japanese yen. The number of initial jobless claims last week rose to its highest level in seven years and well above forecast, the Labor Department said. Orders to U.S. factories plunged by 4 percent in August, according to a Commerce Department report.
The euro bought 1.3824 dollars in late New York trading compared with 1.4061 dollars it bought late Wednesday.
The dollar rose to 1.1364 Swiss francs from 1.1226 Swiss francs, and fell to 105.27 Japanese yen from 105.84 Japanese yen. It rose to 1.0796 Canadian dollars from 1.0618 Canadian dollars.
Source:Xinhua
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