The dollar rebounded from a one-week low against the yen on speculation U.S. financial companies will raise
the funds needed to weather credit-market losses.
The U.S. currency gained after people
familiar with the matter said Lehman Brothers Holdings Inc. sold $120 billion
of its holdings in the second quarter and the Wall Street Journal reported the
company will raise more than $5 billion in capital from outside investors.
The U.S. currency
traded near the lowest in almost two weeks versus the euro after a government report June 6
showed the U.S.
unemployment rate climbed the most in two decades. It also traded near its
weakest level in 25 years against Australia's currency as investors
reduced bets the Federal Reserve will raise interest rates this year.
The U.S. currency
has fallen 12% against the euro and 9% versus the yen since September when the
Fed began to lower borrowing costs. Futures on the Chicago Board of Trade on
June 6 showed a 62% chance the Fed will increase the 2% target rate by at least
a quarter-percentage point by December, compared with 77% odds a week earlier.
EUR/USD consolidated near lows on $1.5770 before rate
began to rebound to $1.5830/40.
GBP/USD rose from $1.9670 to $1.9825/30.
USD/JPY rose from Y104.40 to Y105.40 before back off
to Y105.00.
Gains in the dollar against the yen may be limited by speculation an industry report today will show the worst housing slump in a quarter century is weighing on the U.S. economy.