24 February 2005, 13:44  U.S. Dollar Sinks Against Euro

The U.S. dollar slipped further Thursday against the euro, which shot up earlier in the week on reports South Korea planned to diversify its foreign currency reserves.
The euro was at US$1.3232 in morning European trading, up from US$1.3226 late in New York on Wednesday.
The U.S. dollar was mixed against other rivals, with the British pound at US$1.9091, down slightly from US$1.9095. The dollar purchased 104.67 Japanese yen, down from 104.85 the day before.
The dollar spiked from US$1.3067 at the end of last week to above the US$1.32 mark on Tuesday after reports that South Korea was going to start selling dollars to diversify its foreign reserve holdings. Though that report was denied by South Korea's central bank, the dollar has not yet recovered.
The euro soared from about $1.20 in September to an all-time high of $1.3667 at the end of December, powered by concerns over the U.S. budget and trade deficits.
The dollar has since regained some ground, but analysts think the recovery could be temporary and that the euro will continue its precipitous rise this year.

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