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Oct 27, 2011, 08.43 AM IST
Forex - Dollar loses ground in mid-day Asian trade
Forexpros - The U.S. dollar moved lower against its major counterparts in Asian trade Thursday, as investors shied away from the safe-haven greenback on hopes for a resolute agreement from European officials to tackle the region's debt crisis.
In mid-day Asian trade, the greenback was lower against the euro, with EUR/USD gaining 0.37% to hit 1.3957.
At a summit of European leaders in Brussels, European Council President Herman Van Rompuy said that finance ministers would finalize workings of a bank recapitalization plan outlined earlier Wednesday.
EU leaders had discussed a number of options, according to reports, to expand the power and reach of the USD612 billion European Financial Stability Facility, a rescue fund for debt threatened nations in the euro-zone.
French President Nicolas Sarkozy was reportedly hoping to enlist the support of China who would contribute to the fund by purchasing bonds issued by the EFSF.
European officials have set their sights on an expansion to the fund totaling USD1.38 trillion, according to reports.
In a late report, European banks were to be pressed to raise USD147 billion by next June in order to comply with capital requirements agreed to by European leaders in Brussels.
Earlier Wednesday, the U.S. Census Bureau reported that sales of new homes rose more than expected, by 5.7% in September, to 313,000 units. Market expectations were for an increase to 300,000 units for the month.
Separately, the Census Bureau announced that core durable goods orders advanced by 1.7% in September, outstripping economist forecasts of a 0.5% increase. Durable goods orders, including transportation items, fell by 0.8% in September, the second straight monthly drop.
In Wednesday trade, Wall Street shares moved higher on hopes for progress at the Brussels summit. The Dow Jones Industrial Average rose 1.39% to 11,869.00, the Nasdaq Composite Index advanced 0.46% to 2,650.67, and the S&P 500 added 1.05% to end the day at 1,242.00.
Meanwhile, the greenback was lower against the British pound, with GBP/USD gaining 0.27% to hit 1.6018.
The dollar was lower against both the Japanese yen and the Swiss franc with USD/JPY down 0.20% to hit 76.03, and USD/CHF lower by 0.27% to hit 0.8785.
The greenback was lower against its Canadian, Australian and New Zealand counterparts with USD/CAD down 0.31% to hit 1.0009, AUD/USD higher by 0.67% to hit 1.0467, and NZD/USD gaining 0.36% to hit 0.8040.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.20% at 76.02.
The U.S. Department of Labor was scheduled to release its latest weekly report on jobless claims later Thursday.
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