By Polya Lesova and Myra P. Saefong, MarketWatch
LONDON (MarketWatch) — The U.S. dollar rose against major rivals on Monday, while the euro fell sharply as worries about the euro-zone debt crisis escalated anew.
The greenback recouped some of the hefty losses it suffered Friday on the heels of disappointing U.S. employment data.
The dollar index (DXY 79.83, +0.45, +0.57%) , which measures the performance of the greenback against a basket of other major currencies, climbed to 79.931 on Monday, up from 79.377 in North American trading Friday after the jobs report. See Friday’s currencies story.
The euro (EURUSD 1.3277, -0.0100, -0.7474%) slumped against the dollar, falling to $1.3253 from $1.3411 late Friday.
The decline in the euro came ahead of a meeting in Brussels of euro-zone finance ministers, where they are expected to debate the response to the region’s debt crisis.
Reuters reported that the head of the International Monetary Fund, Dominique Strauss-Kahn, plans to urge European officials to increase the size of the 750-billion-euro ($998 billion) emergency aid fund for euro-zone nations.
Meanwhile, two senior European officials proposed the creation of European sovereign bonds, or E-bonds, to be issued by a European Debt Agency. Read more on the proposal.
In other trading, the dollar (USDYEN 82.9100, +0.2500, +0.3026%) bought 82.87 yen, up from ¥82.53 Friday. See real-time currency quotes and tools.
On Friday, the U.S. Labor Department reported that the nation’s unemployment rate rose to 9.8% in November from 9.6% in October.
“The weak nonfarm payrolls data on Friday were a not-so-gentle reminder that while the [euro] has its fair share of problems with the peripheral euro-zone sovereign debt, anemic growth and the [Federal Open Market Committee’s second round of quantitative easing] are significant negatives for the [U.S. dollar],” said David Forrester, a foreign-exchange strategist at Barclays Capital, in a note to clients.
Federal Reserve Chairman Ben Bernanke said Sunday on the CBS News’ “60 Minutes” television program that the Fed could commit more money beyond the $600 billion in asset purchases announced last month to provide a further boost to the economy. Read more about Bernanke’s comments.
