Dollar rises against euro and pound after European rate cuts

Special Report:Global Financial Crisis

NEW YORK, March 5 (Chinese media) -- The dollar rose against the euro and the

pound on Thursday after the European Central Bank and the Bank of England cut

interest rates to boost their economies.

The European Central Bank (ECB) reduced rate by 50 basis points, leaving

its key rate at a record low of 1.5 percent. It brings the cumulative reduction

in interest rate of ECB to 275 basis points since October 2008.

There are very clear indications that ECB would cut rates further, analysts

said. ECB President Jean-Claude Trichet said at a press conference on Thursday

that the bank didn't decide ex-ante that this was the lowest point and he did

"not exclude" that rates could go down further.

The Bank of England also cuts its key rate by 50 basis points on Thursday.

The current rate of 0.5 percent is the lowest level since the bank came into

being over three hundred years ago. The pound fell in early New York trading,

but it regained some grounds later as investors expect that the rate cut would

help British economy to recover.

The dollar rose to a four-month high of 99.67 yen earlier in the session as

investors worried about health of the Japanese economy. The greenback later

retreated against the yen on profit taking.

The euro bought 1.2544 dollars in late New York trading compared with

1.2639 dollars it bought late Wednesday. The pound fell to 1.4112 dollars from

1.4156 dollars.

The dollar rose to 1.2902 Canadian dollars from 1.2737 Canadian dollars,

and fell to 1.1712 Swiss francs from 1.1715 Swiss francs. It fell to 98.21

Japanese yen from 99.22 Japanese yen.