Dollar Weakens as Banks Experience Major Loss
The US Dollar slid against major currencies on Friday as the country’s two biggest banks, Bank of America Corp. and Citigroup Inc, experienced major losses in the fourth-quarter of 2008. With this alarming trend, analysts predicted that unemployment rate will rise and low consumer confidence will get worse.
The US dollar slid against major currencies on Friday as the country’s two biggest banks, Bank of America Corp. and Citigroup Inc., experienced major losses in the fourth-quarter of 2008.
To cushion the impact of financial losses, the banks announced its plan to improve its operations by adopting new monetary measures.
In New York trading, Euro rose to $1.3300 from $1.3163 and the British Pound increase to $1.4746 from $1.4659 on Thursday.
Recently, Cititgroup reported its $8.29 billion loss, prompting the company to split itself into two entities: Citicorp which will focus on traditional banking worldwide and Citi Holdings which will manage riskier financial ventures.
The Bank of America also revealed its loss amounting to $2.39 billion. Meanwhile, the federal government announced it plan to give the company a stimulus package worth $20 billion.
As the country is sliding into a deep economic recession, economic analysts and experts warned that major companies will continuously lay off thousands of workers, giving rise to the unemployment rate and low consumer demand.
According to a report released by Labor Department, the consumer price index declined 0.7 percent as oil demand fell last month.
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