US Dollar Little Changed Despite Weak Economic Reports
New York (Nov 30) The dollar is turning in a mixed performance against its major rivals Monday afternoon. However, the US currency is little changed overall despite a pair of weaker than expected economic reports.
Chicago -area business activity unexpectedly contracted in the month of November, according to a report released by MNI Indicators on Monday. The report said the Chicago Business Barometer tumbled to 48.7 in November from 56.2 in October, with a reading below 50 indicating a contraction in regional business activity. Economists had expected the index to 54.0.
After reporting decreases in US pending home sales in the two previous months, the National Association of Realtors released a report on Monday showing a slight uptick in pending sales in the month of October.
NAR said its pending home sales index inched up by 0.2% to 107.7 in October from an upwardly revised 107.5 in September. Economists had expected the index to climb by 1.0%.
There will be a slew of US economic data released this week, including the closely watched monthly jobs report due on Friday. The jobs report, which is expected to show an increase of about 190,000 jobs in November, could have a significant impact on the outlook for interest rates.
Reports on manufacturing and service sector activity, private sector employment and international trade are also likely to attract some attention.
Federal Reserve Chair Janet Yellen is also scheduled to deliver two speeches this week, joining several other Fed officials that are due to give remarks.
The European Central Bank is scheduled to hold a monetary policy meeting on Thursday, with many expecting the bank to provide further stimulus.
The dollar climbed to a high of USD1.0557 against the Euro Monday, but has since eased back to around USD1.0570 .
Germany's retail sales declined more-than-expected in October, reflecting a weak start to the fourth quarter spending ahead of Christmas.
Retail sales dropped by real 0.4% in October from September, when it remained flat, figures from Destatis showed Monday. In August, sales had declined 0.7%. Economists had forecast only a marginal 0.2% fall for October.
Germany's consumer prices rose for a second consecutive month in November and at the fastest pace in five months, preliminary figures from Destatis showed Monday. The consumer price index climbed 0.4% year-on-year following 0.3% increase in October. Inflation was in line with economists' expectations.
The buck rose to an early high of USD1.4992 against the pound sterling, but has since dropped to around USD1.5060 .
UK mortgage approvals increased marginally in October, the Bank of England reported Monday. The number of mortgages approved for house purchases rose to 69,630 in October from 69,012 a month ago. It was also above the average of 68,099 over the previous six months but slightly below the expected level of 69,900.
Further slowdown in emerging economies poses risks to Japanese exports and production which would in turn undermine corporate profits, Bank of Japan Governor Haruhiko Kuroda said Monday.
"The risk that a contraction in exports and production will undermine corporate profits and hence investment does not seem to be that great," he told business leaders in Nagoya .
The greenback broke out to a 1-week high of Y123.339 against the Japanese Yen Monday, but has since retreated to around Y123.060 .
Industrial output in Japan gained a seasonally adjusted 1.4% on month in October, the Ministry of Economy, Trade and Industry said in Monday's preliminary reading - rising for the second straight month. That missed forecasts for an increase of 1.8%, although it was up from 1.1% in September.
Japan's housing starts declined for the first time in eight months in October, defying economists' expectations for an another increase, data from the Ministry of Land, Infrastructure, Transport and Tourism showed Monday.
Housing starts fell 2.5% year-over-year in October, reversing a 2.6% climb in the previous month. Economists had expected the same 2.6% rise for the month.
Source: AllianceNews
