| CATEGORY: FX |
Tue 14 Aug 2012
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LONDON (SHARECAST) - The US dollar lost ground to the euro on Monday, but trimmed losses after German daily Handelsblatt reported on its online portal that a new complaint against the European rescue mechanism has been filed in Germany's Constitutional Court. Apparently, the new complaint questions a court decision on the ESM (European Stability Mechanism).
As a result, the final decision by the German Constitutional Court may be delayed although it was originally expected to take place by September 12th. Without approval, Germany will be unable to disburse its contribution to the ESM fund.
Despite the above, hopes that the European Central Bank will buy up government debt in the bond markets sent the European common currency higher.
Though it had been as high as $1.2373 at one point on Monday, the euro closed New York trading at around $1.2341 against the dollar, up from $1.2287 at the end of last week.
Sterling also edged up against the greenback, rising to $1.5685 from $1.5611 on Friday.
The value of the US dollar as measured by the ICE dollar index declined to 82.404 from 82.541 on Friday.
JH
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