Dollar story of the day

The Australian and New Zealand dollars hit new highs against the euro in European trading Monday. The market was overall in quiet tone as currency traders prepared for a potentially key week of central-bank policy decisions on both sides of the Atlantic.

Commodity-linked currencies benefited as investors sought them out in the wake of the ECB's recent cut in its deposit rate. Against the euro, the New Zealand dollar rose on a synthetic basis to its highest level since 1986 while the Australian dollar was its strongest in 26 years.

Sterling was steady against the dollar and the euro. After the Swiss National Bank reported a weekly increase in its sight deposits, the Swiss franc was marginally stronger against the dollar, mostly because of its heavy buying of foreign-currency purchases to defend the 1.2 franc-per-euro minimum trading floor set by the central bank last September to curb the strength of the franc. The franc later eased; the dollar recently bought 0.9818 franc from 0.9750 franc.

The Wall Street Journal Dollar Index, which tracks the U.S. dollar against a basket of major currencies, was at 71.91 from about 71.666.