Dollar Ends Week on Quiet Note After U.S. Data Fails to Ignite and Other Top Forex News.
The dollar had a quiet end to the week, remaining virtually unchanged against the other major currencies following the release somewhat mixed economic data at home.
This mornings data got off to a bad start when the University of Michigan said that its consumer sentiment index fell to 81.8 in May, from a reading of 84.1 the previous month, compared to expectations for a rise to 84.5.
But the news was offset by a rise in building permits. With U.S. building permits climbing 8% to 1.080 million units last month, from an upwardly revised 1.000 million in March. Analysts had expected building permits to rise to 1.010 million units in April.
The report also showed that building starts rose to 1.072 million units in April, from 0.947 million in March, whose figure was revised up from a previously estimated 0.946 million. Analysts had expected building starts to rise to 0.980 million units last month.
The data neutralized any movement for the greenback, with USD/JPY inching down just -0.09% to 101.48 at the end of the session.
It was a similar story in the eurozone, with official data showing that bloc’s gross domestic product grew just 0.2% in the first quarter, compared to expectations for growth of 0.4%. On a year-over-year basis the bloc’s economy expanded 0.9%, falling short of expectations for growth of 1.1%.
While a separate report showed that the annual rate of inflation was unchanged at 0.7% in April, in line with forecasts, but still well below the ECB’s target of close to but just under 2%.
Investors also continue to monitor developments in Ukraine following U.S. Secretary of State John Kerry statement that Russia would face broader economic and industrial sanctions if it meddled in Ukraine’s presidential elections on May 25.
EUR/USD ended the session, down -0.11% at 1.3696.
Elsewhere, the pound strengthened against the dollar, but remained vulnerable following the Bank of England’s statement on Wednesday in which it indicated that it is in no rush to hike interest rates and left forecasts for growth and inflation unchanged in its quarterly Inflation Report.
And the Australian dollar was little-changed for the week, despite a brief stint above US94¢, as fears of a post-budget fiscal drag offset any positive buying in the market.
AUD/USD closed the session up 0.07% at 0.9363.
And the New Zealand dollar fell as traders continue to back the greenback in the face of mixed U.S. economic data driving down interest rates in the world’s biggest economy.
NZD/USD closed the session down -0.12% at 0.8634.
And finally, the Canadian dollar was higher after official data showed that foreign securities purchases declined by C$1.23 billion in March, after a C$6.07 billion in increase in February, whose figure was revised down from a previously estimated C$6.08 billion rise.
Analysts had expected foreign securities purchases to rise by C$7.21 billion in March.
USD/CAD closed the session down -0.13% at 1.0869.
More coverage of today’s session.
- FT: Euro slips as periphery bond yields rise. – The dollar gained ground against the euro this week as investors considered the likely monetary easing action to come from the European Central Bank next month.
- Dean Popplewell: EUR contained while GBP has potential. – To many, ECB action seems certain but what’s to be delivered remains unclear. Euro policy makers will have to deliver a compelling initiative, enough to ensure financial markets react positively and weaken the EUR.
More Top Stories:
FT: Currency cold war is starting to heat up. – The last round of “currency wars” ended a year ago in an uneasy truce, when G20 finance ministers agreed not to target their exchange rates for competitive purposes.
The Australian: Australian dollar falls as investors seek safety. – The Australian dollar was lower today after a surprise rally in safe-haven assets.
TVNZ: NZ dollar predicted to fall. – The New Zealand dollar may fall as traders continue to back the greenback in the face of mixed US economic data driving down interest rates in the world’s biggest economy, which would typically weigh on the American currency.
SMH: Budget keeps Australian dollar in check. – The Australian dollar was little-moved for the week on Friday, despite a brief stint above US94¢, as fears of a post-budget fiscal drag offset any positive buying in the market.
MarketWatch: Gold futures edge up, poised for weekly gain. – Gold futures traded mostly higher on Friday, with demand for the metal getting a boost on the back of an unexpected dip in U.S. consumer sentiment and prices on track for a modest gain on the week.