Dollar rises vs euro

* Dollar rises vs euro, basket of currencies, near 2-yr highs

* Emerging markets, economy worries underpin dollar demand

* Yen hits 6-year high vs euro on risk aversion, repatriation

* Nikkei down over 5 percent on earnings worry, yen cross hit

By Chikako Mogi

TOKYO, Oct 24 (Reuters) - The dollar rose against the euro and a basket of currencies on Friday, holding near two-year highs as worries about global economies and emerging markets prompted investors to keep reducing risk assets and repatriate funds.

Emerging market currencies have been hit hard by the global credit crisis in recent weeks, intensifying risk aversion and prompting investors to repatriate their overseas investments.

Deepening financial turmoil has boosted the allure of the dollar, the world's most liquid currency.

The dollar's broad strength has added fuel to sharp falls in other yen crosses as investors unwind high-yielding currencies favoured for carry trades, using the low-yielding yen to buy high-yielding currencies, traders said.

Bloomberg.com: India & Pakistan

Crude oil pared gains on concern a potential OPEC output cut is insufficient to stave off price declines as global economic growth slows and fuel demand falls.

OPEC is expected to slash at least 1 million barrels a day of production when it meets today in Vienna, according to a Bloomberg News survey. Iran's Oil Minister.

Gholamhossein Nozari said yesterday a 2 million barrel-a-day reduction was needed. U.S. fuel demand fell 8.5 percent from a year ago, the Energy Department said Oct. 22.

``Anything less than 2 million barrels and we're headed lower,'' said Mark Waggoner, president of Excel Futures Inc. in Irvine, California, in an interview with Bloomberg Television. ``The markets are going to go down from here to $58.''

Oil for December delivery was at $67.64 a barrel, down 20 cents, on the New York Mercantile Exchange at 12:38 p.m. Singapore time. It earlier rose as much as $1.66, or 2.5 percent, to 69.50 a barrel. Prices are down 22 percent from a year ago and 5.9 percent this week.

Brent crude oil for December settlement was at $65.66 a barrel, down 26 cents, on London's ICE Futures Europe exchange at 12:36 p.m. Singapore time. It earlier rose as much as $1.41, or 2.1 percent, to $67.33 a barrel.

Oil has dropped from the record $147.27 a barrel in New York on July 11 as slowing economic growth curbs demand.

China, the world's fastest-growing energy consumer, said Oct. 20 its economy expanded at 9 percent in the third quarter, the slowest pace in five years. Concern a deepening global slump will damp profits has pushed the MSCI World Index 4 percent lower this week.

OPEC Cuts

Prices dipped during trading yesterday after Saudi Arabian Oil Minister Ali al-Naimi declined to express his support for a possible cut, on his arrival in Vienna. Saudi Arabia and Iran are the Organization of Petroleum Exporting Countries' two biggest producers.

``Who said anything about a cut?'' al-Naimi said. ``Prices will be determined by the market.''

OPEC should cut production by 2 million barrels a day to stem the slump in prices and ``balance'' the market, Iranian Oil Minister Gholamhossein Nozari said earlier.

OPEC leaders are scheduled to meet in Vienna today at 9 a.m. local time.

The last time OPEC lowered quotas was at a December 2006 meeting in Abuja, Nigeria. The 500,000 barrel-a-day cut took effect in February 2007, expanding an earlier reduction agreed to in October. The cuts were reversed later in 2007 as prices rose.

Barack Obama, John McCain spar over tax policy, economy | News for Dallas, Texas | Dallas Morning News | National Politics

As John McCain warned that Barack Obama's tax plans would make a bad economic situation worse, Mr. Obama said that Mr. McCain supported a 'Wall Street first, Main Street last' economic philosophy.

The economy continued to dominate the presidential rivals' stump speeches as they sought to shore up support in battleground states. Mr. McCain campaigned in Florida on Thursday, while Mr. Obama attended a rally in Indianapolis.

Mr. McCain promoted his proposals to cut taxes for individuals and businesses as crucial to rebuilding the economy.

"We shouldn't be taxing our small businesses more, as Senator Obama wants to do. We need to be helping them expand their businesses and create jobs," he told a rally at a lumber yard in Ormond Beach.

Mr. Obama accused his opponent of not making workers his top priority.

Mr. McCain "wants to keep putting corporations ahead of workers," Mr. Obama said. "Who's looking out for steelworkers? Who's fighting for carpenters? Who's fighting for teachers? Who's fighting for Teamsters? That's the president I want to be."

As a counterpoint to Mr. Obama's appeal to working-class voters, Mr. McCain crossed central Florida on Thursday in a "Joe the Plumber" bus tour with stops at a lumber yard, a dentist office, a restaurant and a produce market.

Mr. McCain reminded audiences of Mr. Obama's "spread the wealth" line, saying Mr. Obama's commitment to raising taxes on those making more than $250,000 a year would kill jobs.

"My commitment to small-business owners here is that I will not spread their wealth around," said Mr. McCain following a meeting with local residents at a restaurant in Orlando. "I want them to keep their wealth and create jobs."

Mr. Obama, playing off a comment Mr. McCain made to CNN that he would cut taxes "for every business in America," said his rival "made the peculiar argument that the best way to stop companies from shipping jobs overseas is to give more tax cuts to companies that ship jobs overseas."

Mr. Obama added: "More tax cuts for job outsourcers? That's what Senator McCain proposed as his answer to outsourcing." The McCain campaign called the inference a distortion.

The Obama camp replied in kind, accusing Mr. McCain of twisting many elements of his tax plan, including a proposal regarding a tax credit on mortgage interest.

Mr. Obama also warned that homelessness could spike without quick action to stave off foreclosures – policies he suggested his opponent has resisted.

Mr. McCain on Thursday repeated his call for the Bush administration to purchase troubled mortgages so homeowners could renegotiate them at more favorable terms.

"I can't emphasize how important it is to keep people in their homes, to go out and buy up these bad mortgages and give people a mortgage they can afford," he said.