GERMANY/ U.K.: THE EURO BREAKS 99 CENT MARK AGAINST THE DOLLAR TAKING THE EUROPEAN SINGLE CURRENCY TO A 28-MONTH HIGH

Record ID: 648748

  • Title: GERMANY/ U.K.: THE EURO BREAKS 99 CENT MARK AGAINST THE DOLLAR TAKING THE EUROPEAN SINGLE CURRENCY TO A 28-MONTH HIGH
  • Date: 26th June 2002
  • Summary: (U5) FRANKFURT, GERMANY (JUNE 26, 2002) (REUTERS - ACCESS ALL) 1. WS: EXTERIOR FRANKFURT STOCK EXCHANGE 0.07 2. VARIOUS OF TRADING (6 SHOTS) 0.34 (U5) LONDON, UNITED KINGDOM (JUNE 26, 2002) (REUTERS - ACCESS ALL) 3. GRAPHICAL CHART OF DOLLAR/EURO EXCHANGE RATE 0.44 4. SCU: (SOUNDBITE) (English) ROSEMARY RADCLIFFE, ECONOMIST, PRICEWATERHOUSECOOPERS, SAYING: "What is happening now is which is something perhaps was overdue for some considerable period of time. I prefer to think of us coming to the end of a period when dollar was overvalued in relation to the underlying economic facts of life. The U.S. after all was running a record deficit for a record period of time. Despite their economic downturn they are still running a hefty deficit. You can't do that indefinitely without the value of your currency starting to come under pressure. And I think what we are seeing now on the back of recent economic information, what's happening on world's stock market, is a correction in the relationship between the dollar and the euro, which is perhaps rather overdue." 1.22 (U5) FRANKFURT, GERMANY (JUNE 26, 2002) (REUTERS - ACCESS ALL) 5. VARIOUS OF EURO SIGN BY EUROPEAN CENTRAL BANK (3 SHOTS) 1.38 6. VARIOUS OF PEOPLE IN STREET; PEOPLE SITTING IN OUTSIDE CAFE'S (3 SHOTS) 1.51 7. CU: (SOUNDBITE) (English) UNIDENTIFIED FRANKFURT RESIDENT SAYING: "That was something I was really hoping for all these years. I was very optimistic when they introduced euro, and I was very disappointed then. And now I think it's alright." 2.03 8. CU: (SOUNDBITE) (English) UNIDENTIFIED FRANKFURT RESIDENT SAYING: "I'm delighted that the European currency is so successful and has been successful over the last couple of days. If everything is correct what I've heard so far, I believe that the euro will become stronger." 2.18 9. TILT: EUROPEAN CENTRAL BANK 2.23 10. CLOSE UP: EU FLAG FLYING 2.28 Initials Script is copyright Reuters Limited. All rights reserved
  • Embargoed: 11th July 2002 13:00
  • Keywords:
  • Location: FRANKFURT, GERMANY/LONDON, UNITED KINGDOM
  • City:
  • Country: United Kingdom
  • Reuters ID: LVAD1RSOXHMIJWUTN8JBSHZ1W3RS
  • Story Text: The euro has gained further value against the dollar,
    breaking the 99 cent mark and taking the European single
    currency to a 28-month high.

    The trigger was news of another accounting scandal in the
    US which has knocked out what little confidence remained in
    equities and reduced demand for the dollar.


    The dollar was down and the euro was up on Wednesday
    (June 26) as investors bailed out of stocks after the Worldcom
    scandal broke; and indices across the world have taken a
    bashing - but many are asking themselves why the euro is
    rising.

    "What is happening now is which is something perhaps was
    overdue for some considerable period of time. I prefer to
    think of us coming to the end of a period when dollar was
    overvalued in relation to the underlying economic facts of
    life. The U.S. after all was running a record deficit for a
    record period of time. Despite their economic downturn they
    are still running a hefty deficit. You can't do that
    indefinitely without the value of your currency starting to
    come under pressure," said Rosemary Radcliffe, Chief Economist
    of PriceWaterhouseCoopers in London.

    Worldcom was the name on everyone's lips - it announced
    late the previous night that the company's accounts were
    overstated by an astonishing 4 billion U.S. dollars. The news
    left many investors wondering who would be next and stock
    markets have fallen around the world.

    This, added to continued political instability in the
    Middle East and comments by President Bush - which have led
    dealers to think the US has abandoned its strong dollar policy
    in all but name - gave little reason to hang on to the dollar.

    The euro has strengthened more than 11 percent against
    the dollar since the beginning of the year and for many in the
    euro's home town that's welcome.

    "I'm delighted that the European currency is so
    successful and has been successful over the last couple of
    days. If everything is correct what I've heard so far, I
    believe that the euro will become stronger," said one
    Frankfurt resident.

    Should one euro exceed the one dollar level it would be a
    large psychological boost to the supporters of Europe's
    currency.


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