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FOREX-Dollar rises as Russia backs reserve currency status

Mon Jun 15, 2009 11:54pm IST
 
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* Russia's Kudrin voices confidence in U.S. dollar

* Euro zone worries help push euro below $1.38 vs dollar

* Data shows slump in U.S. factory sector, capital outflows

* Euro zone banks could face further $283 bln in writedowns (Updates prices, adds quotes, changes byline)

By Wanfeng Zhou

NEW YORK, June 15 (Reuters) - The U.S. dollar rose broadly on Monday after Russia expressed confidence in the greenback as the world's reserve currency, while concerns about the euro zone economy undermined the euro.

The single European currency fell below $1.38 to its lowest level in more than three weeks after the European Central Bank said euro-zone banks will probably need to write down another $283 billion. See [ID:nLF804645].

Speaking on the sidelines of a Group of Eight finance ministers in Italy, Russia's Finance Minister Alexei Kudrin said the dollar's role as the world's main reserve currency is unlikely to change in the near future.

The comments followed news from Russia last week that it would cut the share of U.S. Treasuries in its reserves and alleviated concerns that major emerging market countries may be diversifying away from the dollar ahead of a summit of leaders of Brazil, Russia, India and China (BRIC) in Russia on Tuesday.  Continued...

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