Dollar rises along with US stock market

AP News
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Posted: Jun 27, 2012 3:37 PM

NEW YORK (AP) — The dollar closed higher Wednesday, boosted by encouraging — if incremental — news about the U.S. economy.

The dollar rose against key currencies including the euro and the British pound.

The British pound fell to $1.5559 from $1.5639. The euro fell to $1.2459 from $1.2499.

The dollar was also up compared to the Japanese yen and the Swiss franc. They, like the dollar, are considered safer investments that people flock to when they're nervous about the economy.

The dollar rose to 79.75 Japanese yen from 79.47 yen, to 1.0258 Canadian dollar from 1.0240 Canadian dollar, and to 0.9640 Swiss franc from 0.9609 Swiss franc.

The U.S. stock market also rose, propelled by encouraging news about home sales and businesses' orders for durable goods.

The European Union summit, which starts Thursday, could give investors more clarity about how they want to trade the euro, though many of the previous summits have yielded only vague results.

Boris Schlossberg of BK Asset management wrote in a note to clients that the rhetoric among the European countries ahead of the summit seemed "confrontational rather than conciliatory." If EU officials "truly fail to achieve any progress this week," he wrote, then the euro could fall back to about the $1.23 level.