Dollar Gets Battered

The dollar is taking a battering Monday morning as investors weigh up the costs of the US financial rescue plan.

The implications of spending $700 billion on soured mortgage-related assets and providing $400 billion to guarantee money-market mutual funds may end the rally that began in June and drove the U.S. currency up 10 percent versus the euro.

"The downdraft on the dollar from the hit to the balance sheet of the U.S. government will dwarf the short-term gains from solving the banking crisis," said one analyst.

At 9.50am London time the pound stood at $1.8434.