Forexpros – The U.S. dollar held gains against its major counterparts on Monday, as investors focus turned to the outcome of talks by European Union finance ministers aimed at measures to address the debt crisis in the euro zone.
During U.S. morning trade, the dollar was slightly higher against the euro, with EUR/USD sliding 0.21% to hit 1.3014.
EU finance ministers held talks to discuss plans to provide up to EUR200 billion in loans to the International Monetary Fund, as well as changes to the EU treaty that would allow a permanent euro zone bailout fund to be established.
However, concerns over the threat of credit rating cuts lingered after Fitch’s Investor Services lowered France’s credit outlook and put six euro zone countries on review pending possible downgrades on Friday, saying that it believes a solution to the debt crisis is “technically and politically beyond reach”.
The dollar had strengthened broadly earlier as news of North Korean leader Kim Jong il’s death fanned concerns over potential geopolitical instability in northeast Asia.
The greenback was also higher against the pound, with GBP/USD slipping 0.11% to hit 1.5526.
Elsewhere, the greenback was higher against the yen and the Swiss franc, with USD/JPY adding 0.20% to hit 77.92 and USD/CHF inching up 0.05% to hit 0.9365.
Earlier in the day, Japanese Finance Minister Jun Azumi said he would monitor financial market moves following the North Korean news.
Also Monday, Japan’s government said it planned to trim its initial budget for the next financial year back to JPY90 trillion from this year’s record of JPY92 trillion.
Meanwhile, the greenback was lower against its Canadian counterpart, with USD/CAD shedding 0.21% to hit 1.0359. The greenback was higher against its Australian and New Zealand cousins, with AUD/USD falling 0.53% to hit 0.9927 and NZD/USD shedding 0.32% to hit 0.7691.
Earlier Monday, official data showed that wholesale sales in Canada rose more-than-expected in October, advancing 0.9% after a 0.5% increase the previous month.
Analysts had expected wholesale sales to rise 0.3% in October.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.12% to hit 80.78.
Also Monday, the ECB said that the euro zone current account recorded a deficit of EUR7.5 billion in October, swinging from a surplus of EUR2.2 billion the previous month.
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