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Dollar Steadies As IMF Warns On Global Headwinds

Dollar Steadies As IMF Warns On Global Headwinds

The dollar stabilized versus major European rivals on Monday, taking back some steep recent losses amid concerns about the sustainability of the global economic recovery.

Financial ministers from the Group of Twenty meeting in Mexico refused to boost the firepower of the International Monetary Fund, telling European officials to commit their own money for now.

This prompted a warning about the global economy from the IMF.

"The G20 countries must now strengthen resilience to further shocks that could result from the still-fragile financial systems, high public and private debt, and higher world prices," International Monetary Fund Managing Director Christine Lagard said.

There was little reaction to news that German parliament overwhelmingly backed a Greek rescue deal hammered out earlier this month.

The dollar steadied near $1.34 versus the euro, coming off a 10-week low of $1.3485.

A leading indicator of the Eurozone economy increased for the second consecutive month in January, data from a survey by Conference Board showed Monday. The leading economic index increased to 104.1 in January from 103.1 in December.

The dollar improved to $1.5840 versus the sterling, up from a 3-week low of $1.59.

On the other hand, the dollar was hammered versus its Australian counterpart, dropping to A$1.0775 from near A$1.0675.

The greenback ended its winning streak versus the yen, sliding back to Y80.31 from a 7-month peak of Y80.66.

Pending home sales in the U.S. rose by more than expected in the month of January, according to a report released by the National Association of Realtors on Monday, with the pending home sales index rising to its highest level in almost two years.

NAR said its pending home sales index rose 2.0 percent to 97.0 in January from a downwardly revised 95.1 in December. Economists had been expecting to index to increase by about 1.5 percent.

by RTT Staff Writer

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