Forex - US dollar mixed after losing ground overnight on weak data
The US dollar was trading mixed against major currencies on Wednesday morning in Sydney,
following overnight losses after the release of soggy economic data.
The US Conference Board said its consumer confidence index fell to 64.5 in March from 76.4 in February — the lowest reading since March 2003 and well below the 73.5 reading the market had expected.
Meanwhile, the Standard & Poor’s (NYSE:MHP) /Case-Shiller home price index indicated that US home prices fell 11.4 percent in January, the steepest drop since data was first collected in 1987.
At 10.15 am (2315 GMT) the dollar was at 100.13 yen from 100.52 in late trading in New York while the euro was at 1.5611 dollars from 1.5651 dollars.
Overnight, the dollar weakened against the euro after European Central Bank vice-president Lucas Papademos said euro zone inflation developments are ‘unsatisfactory’, adding that the ECB governing council is committed to ensuring that the objective of price stability is achieved in the medium term.
John Noonan at Thomson IFR said Papademos’ statements were not helpful to the dollar which had made some gains on Monday on better US economic data.
Noonan said in a fairly quiet session the dollar bounced to a high of 100.67 yen in Europe before dropping to 99.64 as softer data was released in the US.
He said high-yielding currencies such as the Australian dollar also slipped on risk-aversion selling after the weak US data but improved as Wall Street recovered from its lows for the session.
The Australian dollar dipped to 91.05 US cents but then recovered to trade in a range of 91.70
to 91.75 cents.
Noonan said the mostly positive sentiment on equity markets overnight despite the poor US
economic data should extend into the Asian session.
‘Overall, it looks like an Asian session of range trading, with a US dollar negative bias,’ he said.
Sydney 10.10 am (2310 GMT)
US dollar
yen 100.13
sfr 1.0082
Euro
usd 1.5611
stg 0.7796
yen 156.24
sfr 1.5752
Sterling
usd 2.0029
yen 200.38
sfr 2.0210
Australian dollar
usd 0.9163
stg 0.4575
yen 91.655
New Zealand dollar
0.8052
bruce.hextall@thomson.com
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Source: CNN Money
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