By Dow Jones Business News,
August 08, 2014, 04:36:00 PM EDT
By James Ramage
The dollar weakened against the euro Friday after the start of U.S. airstrikes in Iraq and other geopolitical tensions
coupled with the lowest U.S. bond yields in more than a year to prompt investors to shift out of bets on the greenback.
The euro rose 0.3% against the dollar to $1.3410, while the greenback slipped 0.1% versus the yen to Y102.04 in late-
Friday's stronger euro came despite monetary policy and most economic data in the U.S. and euro zone indicating
further weakness for the common currency, with investors recently betting heavily on a stronger dollar. But the recent
increase of hostilities in Ukraine, Israel and Iraq has led to uncertainty and volatility across markets, forcing
investors to make changes to their portfolios.
One place financial managers have advised their clients to exit positions is in currencies, which led to dollar
selling and euro buying Friday, according to Steven Englander, head of G-10 foreign exchange strategy at Citigroup Inc.
"The dollar's run has given way to profit taking," said Joe Manimbo, senior market analyst at Western Union. There is
also "the sense in the market that it will be a long time before the [Federal Reserve] raises rates," he added.
In other trading, the Canadian dollar plunged against most rival currencies on the back of employment numbers for July
that fell well below analysts' expectations. The greenback increased 0.5% versus the Canadian dollar, to C$1.0974. The
loonie, as the currency is also called, lost 0.4% versus the yen, to Y93.03.
--Write to James Ramage at firstname.lastname@example.org
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