NEWS / Foreign Exchange

Dollar still weak

Dollar still weak

The dollar hung near a two-year low against the euro on Monday, staying weak on the view that the Federal Reserve may cut interest rates at least once this year, while rates in the euro region are seen climbing soon. Market participants brushed off comments from U.S. Treasury Secretary Henry Paulson at the weekend that he still believed a strong dollar is in the U.S. interest, a statement that European Central Bank President Jean- Claude Trichet said he had noted with interest.

EURUSD traded between 135.89 and 136.07.

Barclays to buy ABN AMRO

Britain's Barclays Plc is expected to unveil a deal to take over Dutch bank ABN AMRO on Monday, including plans to sell ABN's U.S. retail bank LaSalle to Bank of America, sources familiar with the situation said.

A deal would be the biggest bank takeover. ABN was valued at more than 68 billion euros (USD 92.5 billion) at Friday's close.

Australian PPI weaker

Australia's producer prices were unchanged in the first quarter, confounding forecasts for a rise and offering hope that inflationary pressures were slackening enough to avoid another increase in interest rates. The years 1 quarter final goods PPI was 0 % qtr/qtr, economists' medianforecast +0.6 % and on year basis it rose 2,8 % under forecast of 3.5 %.

AUDUSD traded between 83.45 and 83.80.