Dollar soars against euro

By Julianne Pepitone
CNNMoney.com contributing writer
NEW YORK (CNNMoney.com) - The dollar rose sharply against major
currencies Monday ahead of anticipated interest rate cuts by the European
Central Bank.

The greenback also received a boost as details began to emerge about
President-elect Barack Obama's plans for a massive U.S. fiscal stimulus plan.

At 9:42 a.m. ET, the dollar was up 2.08 percent against the 15-nation
euro, which was trading at $1.3617.

The greenback also rose .04 percent against the British pound, to
$1.4527. Meanwhile, the buck gained 1.2 percent against the Japanese yen, to
¥93.04.

This is sharp change from recent weeks, when the dollar has been weak,
falling against a basket of currencies amid weak economic reports and a dim
outlook for the start of 2009.
Helping lead the dollar's rally was the Sunday announcement by the vice
president of the European Central Bank that further interest-rate cuts may be
necessary. Italy and Spain have reported poor inflation levels, and the German
chancellor announced Sunday that she is in favor of tax cuts being included in
a second fiscal stimulus package worth up to euro 50 billion.

President-elect Obama, who takes office on Jan. 20, is meeting with
Congressional leaders on Monday, seeking approval on a massive stimulus plan
that includes $300 billion in tax cuts for businesses and middle-class
taxpayers.