- - Thursday, April 14, 2011


Dollar weakens after jobless claims rise

NEW YORK | The dollar fell against most major currencies after a government report showed that unemployment benefits in the U.S. rose unexpectedly.

The Labor Department said Thursday that applications for unemployment benefits rose 27,000 to a seasonally adjusted 412,000 last week. Economists expected a drop in claims.

The euro rose to $1.4490 in late afternoon trading Thursday in New York, from $1.4441 late Wednesday.

The euro has risen about 1.3 percent against the dollar since the European Central Bank raised its key interest rate a week ago. Central banks raise interest rates to curb inflation. Higher rates also tend to increase demand for the currency linked to that country or region.

Analysts have said that the Federal Reserve’s reluctance to raise rates has put pressure on the dollar. The U.S. central bank has kept its benchmark rate near zero since December 2008.


Crisis plan, recovery risks pondered at G20

The United States tried to instill confidence Thursday that the global recovery was not at risk as global finance chiefs gathered to advance a plan to prevent future economic crises.

Finance ministers and central bankers from the Group of 20 rich and emerging countries, and the smaller Group of Seven developed nations, will also weigh the impact of high oil prices, huge government debts and Japan’s disasters.

U.S. Treasury Secretary Timothy F. Geithner, speaking at a conference on the global economy, said the recovery from the 2007-2009 financial crisis was intact and that investment and hiring were starting to pick up.

“Despite the risks in oil, the financial challenges still facing parts of Europe, despite what’s happened in Japan … what you see is gradual healing, gradual strengthening in confidence that the world economy is going to be growing at a reasonable rate,” he insisted.

To prolong recovery, G20 officials were to push forward at a working dinner with plans to build a world economy less prone to the booms and busts that have marked the past two decades.

That would involve shrinking imbalances between export-rich countries such as China and debt-burdened countries such as the United States. Many economists blame such imbalances for sowing the seeds for the crisis.

Story Continues →