Euro falls to 5-week low against dollar

AP News
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Posted: Nov 16, 2011 5:11 PM
Euro falls to 5-week low against dollar

The euro fell to a five-week low against the dollar Wednesday on worries that Europe's debt crisis is spreading. The dollar was mixed against other currencies as traders kept their focus on Europe despite some positive economic data in the U.S.

Borrowing costs in Italy, Spain and France have risen this week. Higher borrowing costs are a sign that investors are worried that those countries may have trouble paying their debts. On Wednesday, the yield on Italy's 10-year bond was just below 7 percent. Greece had to seek a bailout from its lenders after its borrowing costs rose that high. Borrowing rates for Spain and France are above 6 percent and 3 percent, respectively.

The euro fell to $1.3512 in late trading Wednesday from $1.3543 late Tuesday. It fell to $1.3427 earlier, the euro's lowest point since Oct. 10.

In the U.S., the Federal Reserve reported that industrial production rose in October at the fastest rate in three months, a sign that the manufacturing sector is slowly improving. Consumer prices fell in October for the first time since June, and the National Association of Home Builders said its builder sentiment index rose. Builders were less pessimistic about the housing market in November, but the market remains weak.

In other trading, the British pound fell to $1.5776 from $1.5834 late Tuesday. The dollar rose to 0.9170 Swiss franc from 0.9149 Swiss franc. The dollar fell to 76.94 Japanese yen from 77.04 Japanese yen and to and to 1.0188 Canadian dollar from 1.0200 Canadian dollar.