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November 8, 2007
China Remarks Drive Dollar Lower
By CARTER DOUGHERTY
Currency traders gave the dollar a thorough pounding today after a Chinese official suggested that the country could begin to diversify its huge foreign-exchange reserves.
The euro broke the $1.47 barrier before retreating a little and the pound climbed above $2.10, a value it had not reached 26 years ago. Other currencies also posted gains against the dollar.
Remarks by Cheng Siwei, vice chairman of the National People’s Congress in China — a colossal dollar investor by virtue of its $1.43 trillion in currency reserves, most of which are presumed to be denominated in dollars — helped drive the dollar lower.
“In terms of the structure of our foreign exchange reserves, we should take advantage of the appreciation of strong currencies to offset the depreciation of weak currencies,” Mr. Cheng said, according to Reuters.
It will come as a …