Dollar holds up despite growing political worries

October 09, 2013 | 09:19

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The US dollar held up Tuesday even as investors dumped Wall Street stocks and short-term bonds amid rising fears that Washington's political paralysis could wreak deeper economic damage.

Photo showing US dollar notes. (AFP/Juan Barreto)

NEW YORK CITY: The US dollar held up Tuesday even as investors dumped Wall Street stocks and short-term bonds amid rising fears that Washington's political paralysis could wreak deeper economic damage.

At 2100 GMT the euro was at $1.3572, compared to $1.3579 late Monday.

The yen lost ground, with the dollar pushing to 96.86 yen from 96.68 yen and the euro at 131.47 yen, up from 131.30 a day earlier.

US shares sank, with tech stocks hit particularly hard, amid worries that the US political battle over the budget and debt ceiling could spark a general selloff on Wall Street.

The White House and Republican leaders appeared no closer to a deal to end the partial government shutdown and raise the ceiling before the country becomes unable to pay its bills.

"Markets remained in a state of suspended animation as progress on US budget talks proved elusive, but the dollar saw a mild bid in Asian and early European session as some bargain hunting kicked in," said Boris Schlossberg of BK Asset Management.

"With little economic data on the docket currencies continued to trace out very narrow ranges," he said.

The British pound was little changed at $1.6084, compared to $1.6093 on Monday. The dollar rose to 0.9037 Swiss franc from 0.9028 franc.

AFP

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