Dollar plunges to a new low against the Euro (AP) (28-02-2008)

BERLIN (AP) -- Markets interpreted the Fed chairman's comments as an indication of further interest cuts and the dollar resumed its losses against the Euro.

The European common currency rose sharply to $1.5143 after Bernanke's testimony -- well above the $1.4967 it bought in New York late Tuesday. It settled back to $1.5120 in late New York trading Wednesday.

Since Bernanke's last similar assessment, the U.S. housing slump has worsened, credit problems have intensified and the job market has deteriorated. All these factors make people and businesses more cautious toward spending and investment, which further weakens the economy.

The European Central Bank has left interest rates unchanged since last summer, is expected to keep them at 4 percent when it meets next week.

The British pound soared as high as $1.9971 before falling back to $1.9842 late in New York -- below its level of $1.9862 late Tuesday. The dollar fell to 106.45 Japanese yen from 107.26 yen.

In other late New York trading, the dollar fell to 1.0622 Swiss francs from 1.0759 Swiss francs, but edged up to 98.08 Canadian cents from 98 Canadian cents late Tuesday.

 Source: AP