NEW YORK — The dollar sank in active trading on Monday, pushed downward by continuing concerns about the U.S. economy and by strong buying of foreign currencies.
Gold prices, reacting to the dollar's decline, rose strongly. Bullion was quoted at $354.50 an ounce at 4 p.m. EDT at Republic National Bank in New York, up $7 from Friday's late bid.
A sluggish economy could prompt further interest rate cuts. Lower interest rates make dollar denominated investments less attractive.
"It was a further continuation of a weak economy and very little expectation that the economy was going to quickly turn around," said Jack Barbanel, director of futures trading at Gruntal & Co.
Peter Wild, a vice president at Bank Julius Baer & Co. said, "The dollar took a bath today. The dollar really got heavily hit on the downside.
"It looks bad. Last week, what we did in three or four days, the momentum on the upside, was destroyed in three of four hours this afternoon. It looks like the dollar will go much lower now."