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in Boston.

Nonetheless, the euro/yen sell-off shows few signs of slowing.

John Cholakis, a dealer at Dai-Ichi Kangyo Bank in New York, said the euro could drop to

100 yen by week’s end, as the European currency comes under continued pressure from

the dollar and pound in addition to the yen.

Late in New York, the dollar was trading at 107.20 yen, up from 106.17 yen late Tuesday.

The euro was at 96.08 cents, up from 95.95 cents late Tuesday.

Rumors of European Central Bank intervention around the 95-cent level may have sparked

some interest in the European currency, but the market still seems divided on the

currency’s direction. “This is a pivotal point,” said a currency options dealer. “Some say we

could go to 90 cents, others say we can go to parity. The market is still very nervous.”

Widening differentials are likely to hurt the euro further. Analysts expect another U.S.

interest-rate increase by month’s end, particularly after the Federal Reserve’s latest beige

book reported “appreciable expansion” in the U.S. economy from January through

February.

Early last week, Europe’s common currency plunged to a record of 93.90 cents after it

became apparent that the European Central Bank wouldn’t raise interest rates at its

midweek meeting. Although the euro was trading yesterday two cents above its all-time

lows, analysts aren’t ruling out the possibility of a return to those earlier levels — especially

if the Fed raises rates as expected in late March.

The Australian dollar rose to 60.92 cents late in New York from 60.50 cents late Tuesday.

The Australian Reserve Bank said yesterday that it had opted to leave interest rates

unchanged.

The South African rand retraced earlier losses against the dollar. It ended the New York

session at 6.4685 rand to the dollar, compared with 6.5315 rand late Tuesday. Steven

Leach, chief economist for Citibank’s foreign-exchange desk in New York, wasn’t surprised

by the rand’s reversal. He said the South African currency, which is still down more than

5% against the dollar for the year, has been undervalued at recent levels.

The dollar also slipped further against the Mexican peso, as the Mexican stock market

surged more than 3.6%. Late yesterday, the dollar was buying 9.269 pesos, compared with

9.28 pesos late Tuesday.

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