The euro rose against the dollar this morning, despite news from Iraq that resulted in a rally on Wall St and should have lifted the US currency. US stocks rallied overnight after news emerged that Saddam Hussein's sons Uday and Qusay were killed during a fierce ix hour gun battle involving US troops in Northern Iraq. According to analysts, the dollar failed to benefit as the backup in US bond yields and the lack of a solid rebound on Wall St, despite good first quarter earnings results, has dampened enthusiasm somewhat.
"Thus, a more cautious tone is leaving traders hesitant about bidding the dollar higher," said Geraldine Conacagh, senior economist at AIB Treasury. At 0830, the euro was valued at USD1.1385 - up half a percent - and 71.07p sterling. Overnight, US Treasury Secretary John Snow renewed support for a strong dollar but stressed that financial markets must be the final arbiters of currency values. Snow said he and President George Bush both back the US "long-standing" policy of having a strong dollar. //www.fxcentre.com