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Mar.06

3:23 PM ET

Thursday, 6 Mar 2008

US Dollar Falls to New Lows as the ECB Holds Rates Steady and Concerns Over US Growth Continue

Posted By:Gina Francolla

Topics:U.S. Dollar | euro | Currencies

The European Central Bank holds rates steady on Thursday and Bernanke suggests further rate cuts in the US, all sending the US dollar lower, and the euro and pound higher. According to Reuters, Bernanke indicated in his testimony before congress that he was more concerned about US economic growth than inflation, which erodes confidence in U.S. assets and the demand for dollars to buy them.

The US Dollar is at new lows against the Euro, at its lowest point Thursday it cost $1.5365 to buy a Euro [$$EURUSD Loading... () ] , and also hit a lifetime low against the Swiss Franc [$$USDCHF Loading... () ], down almost 10% in 2008 alone.

*The CurrencyShares Swiss Franc ETF [FXF Loading... () ] almost mirrors the move of the dollar vs the Swiss Franc and is up over 11% YTD.

The Dollar Index which measures the performance of the dollar against a basket of six currencies, the euro, yen, British pound, Canadian dollar, Swiss franc and the Swedish krona, is trading at multiple year lows and is down over 13% in the last 12 months.

Though the pound moved higher against the US dollar rising above $2 for the first time this year [$$GBPUSD Loading... () ], the British pound has been near historic lows against the euro with 1 euro buying 0.7692 pound or 1 pound purchasing 1.3068 euro.
The UK economy is suffering as well, going through the weakest period of growth in 15 years as the Bank of England also held rates steady at 5.25% Thursday.