New York Foreign exchange market – the dollar edged up against the euro and sterling slipped on positive U.S. data

Posted by Emvertex

The dollar was slightly stronger against major rivals sterling and the euro after a U.S. economic report.

U.S. industrial production fell 0.1 percent in March after economists had expected a 0.1 percent gain. Meanwhile, the national association of home builders’ (NAHB) sentiment index for April rose 1 point to 63 on Tuesday, in line with expectations, according to the Econoday survey.

Currency analysts said the synchronized rise in global stock indexes was a sign of increased appetite for risky assets, but it was a concern due to the lack of progress in the brexit process, holding the dollar back, although the gains were modest.

The ICE dollar index rose 0.1 percent to 97.04.

The euro
The euro fell after sources said ECB policymakers thought the bank’s economic forecasts were too optimistic because of weak growth in China and continuing trade tensions, the paper said.

The euro ended down to $1.1301 from $1.1304 the day before.

At last week’s policy meeting, a “significant minority” of policymakers cast doubt on the prospects for a long-term growth recovery in the second half of the year. Some even questioned the accuracy of the ECB’s model, given its long history of downward revisions.

Win Thin, head of global currency strategy at Brown Brothers Harriman in New York, said this was another dovishness.

Thursday’s European manufacturing and services purchasing managers’ indices are expected to be closely watched as traders look for signs of improved growth in the region.

The pound
Sterling fell 0.3 per cent to $1.3061 from $1.13097 as British media pointed to fresh pressure on May to come up with an alternative to brexit as soon as possible ahead of European parliamentary elections on May 22.

The yuan
Looking ahead, currency traders are awaiting China’s GDP report, which includes a trade war with the U.S. and stimulus measures taken by the Chinese authorities to ease a sharp downward cycle. The GDP report could be a catalyst for currency moves, and if China’s economy remains weak, it could trigger a cascade of concerns and spark global growth concerns.

But ahead of Wednesday’s GDP report, positive data on China’s housing market gave credence to the country’s strong GDP potential. Average new home prices in China’s 70 largest cities rose 0.6% in March, up from 0.5% in February, according to U.S. media reports.

The yuan was flat against the dollar at 6.7116 yuan, compared with 6.7087 the previous day, a change of less than 0.1 percent.

The Australian dollar
The Australian dollar was weak in early trading but then pulled back to flat after the RBA said a rate cut was “appropriate” if inflation remained low and unemployment rose.


Via:anue-News