Terror Fear Pushed Down Dollar

The international financial market fluctuated on Monday due to security fears caused by al-Qaeda. U.S. and European stocks dropped, and the U.S. dollar devaluated.

The euro-dollar exchange rate stood at $ 1.2290, steeply dropping from $ 1.2223 as of the end of last week.

The dollar slipped as suspicion intensified that al-Qaeda may have been behind last week`s deadly train bombings in Madrid, and the Spanish ruling party, which supported the Iraq war, lost in the general elections.

The financial market is shaky despite the announcement of the Federal Reserve Board that manufacturing in the U.S. increased 0.7 percent last month.

The New York Stock Exchange dropped after a one-day rally. The NASDAQ closed at 1,932.20, down 45.53 points (2.29 percent), the Dow at 10,102.89, down 137.19 points (1.34 percent).

European shares also dropped to their lowest levels in six weeks.

Hye-Yoon Park parkhyey@donga.com