US$ beats euro
LONDON: The dollar rose against the euro on Wednesday despite growing fears of a US recession and ahead of European interest rate decisions, dealers said.
Analysts said the dollar was benefiting from its safe-haven reputation and from US investors pulling their money back home, even as US data continues to spark fears of a recession in the world’s biggest economy.
Another bout of selling on Asian stock markets on Wednesday appeared to have benefited the US currency.
“Price action suggests that episodes of equity-led risk aversion remain strongly beneficial for the dollar,” Geoffrey Yu, forex analyst at UBS, said.
“Greater home bias within the US and limited opportunities overseas due to growth worries will cap the dollar downside – despite weak data – and we expect the currency to find upside momentum in the months ahead,” he added.
In late European trade on Wednesday, the euro fell to US$1.4636 from US$1.4645 in New York late last Tuesday.
Against the Japanese currency, the dollar climbed to 106.76 yen from 106.75.
Analysts said the focus of the market had switched to interest rate decisions by the Bank of England (BoE) and the European Central Bank (ECB) today.
The ECB was expected to leave interest rates on hold given that ECB president Jean-Claude Trichet continued to point to inflation worries in the eurozone.
Economists believe the ECB will be forced to follow the Federal Reserve and the Bank of England at some point and cut rates as evidence grows of slowing activity in the euro area. – AFP

US senate bid for own stimulus plan caves in
WASHINGTON: The US senate failed on Wednesday to advance its own version of an economic stimulus program, boosting the odds for a White House-backed version approved last week by the house of representatives.
Backers fell short of the 60 votes needed to end debate and bring the measure to the floor for passage, with the tally 58-41 in favour.
The vote came amid wrangling in congress over the details of the stimulus of some US$150 billion (K440.5 billion) to help boost flagging growth by giving tax rebates and business incentives.
The House-passed measure calls for checks of up to US$600 (K1,762) for individual taxpayers and and up to US$1,200 (K3,524) for couples, plus additional cash for dependent children.
Democratic leaders in the Senate sought to expand the measure by extending rebates to an additional 20 million elderly Americans living on social security benefits. – AFP

India’s Tata Group snares Boeing deal
NEW DELHI: Mumbai-based Tata Group will supply parts for Boeing's delay-dogged 787 Dreamliner, marking a “turning point” for the Indian aerospace business, the companies said yesterday.
Under the agreement, TAL Manufacturing Solutions, part of the sprawling Tata Group, will supply floor beams for the aircraft, the first deliveries of which are now expected in early next year, a statement by the two companies said.
No financial terms were disclosed for the agreement which marks a “turning point for the Indian manufacturing industry to gain a footprint in the global aerospace business,” the statement said.
The Dreamliner, Boeing's first new model in more than a decade, takes advantage of huge advances in aviation technology, and has been designed using plastic composites instead of aluminium to reduce weight.
Boeing, which last week announced the latest delay of the Dreamliner's launch, said it was proud to welcome Tata into “its family of world-class aerospace suppliers”.
“We are confident this partnership will help Boeing and Tata leverage mutual best-value capabilities,” Carolyn Corvi, a Boeing vice-president, said
The partnership “will further increase the value of the 787 to our customers, helping make it the world's leading commercial airplane,” she added.
The floor beams will be produced at TAL’s new facility in Nagpur using advanced titanium and composite materials and transported to Boeing partners in Japan, Italy and the US for further assembly.
“The production of Boeing's structural components by TAL indicates technical and manufacturing excellence within the group,” TAL chairman Ravi Kant said.
“This agreement has the potential to develop into a more broad-based alliance,” he added. – AFP