Dollar rises on fears about global economy

AP News
Posted: Mar 22, 2012 3:48 PM

Fears that China and Europe's economies are weakening pushed the dollar higher against most other currencies Thursday.

A drop in an index compiled by HSBC suggested that manufacturing activity in China, the world's second biggest economy, fell in February from the month before.

Concerns about the world's second biggest economy rose earlier this week. On Tuesday, a report showed that home prices in 45 Chinese cities fell in February. And mining company BHP Billiton Ltd. said that Chinese demand for its iron ore, used to make steel, was slowing.

In Europe, a separate index released Thursday found that manufacturing and services activity in the region fell in March from the previous month.

The euro fell to $1.3181 in late trading Thursday from $1.3204 late Wednesday. The British pound fell to $1.5817 from $1.5858.

Fears about the global economy overshadowed better news about the U.S. jobs market. The Labor Department said that the number of people seeking unemployment aid dropped 5,000 to 348,000. That's the lowest level since March 2008.

In other trading Thursday, the dollar rose to 0.9147 Swiss franc from 0.9131 Swiss franc and to 1.0004 Canadian dollar from 99.24 Canadian cents.

But the dollar fell to 82.59 Japanese yen from 83.47 yen.