US Dollar Rising Against European Rivals After Consumer Sentiment Report

Frankfurt (Jun 11)  The dollar is trading higher against its major European rivals Friday afternoon, but has turned lower against the Japanese Yen. The bulk of the buck's gains against the Euro and the British pound occurred after the release of the US consumer sentiment report. Continued concerns over a possible "Brexit" are also contributing to the weakness in the pound.

Reflecting concerns about future economic prospects, the  University of Michigan  released a report on Friday showing a modest decrease by its reading on US consumer sentiment in the month of June. The report said the preliminary reading on the consumer sentiment index for June edged down to 94.3 compared to the final May reading of 94.7. Economists had expected the index to dip to 94.0.

Investors are eagerly awaiting news from the  Federal Reserve  meeting next week Wednesday. Recent economic data suggests the Fed is likely to leave interest rates unchanged, but traders are likely to pay close attention to the accompanying statement.

The dollar has climbed to a 1-week high of  USD1.1255  against the Euro Friday afternoon, from Thursday's low of around  USD1.1415  .

 Germany's  inflation remained low as estimated in May, final figures from Destatis showed Friday. Consumer prices gained 0.1% on a yearly basis, reversing a 0.1% fall in April.

 Germany's  wholesale prices declined at a slower pace in May, data from Destatis showed Friday. Wholesale prices decreased 2.3% in May from last year, slower than the 2.7% fall in April. This was the weakest fall in four months.

French industrial production recovered at a faster than expected pace in April, data from the statistical office Insee revealed Friday. Industrial production grew 1.2% on a monthly basis, in contrast to a 0.4% decline in March and faster than the expected increase of 0.4%. This was the first rise in three months.

The buck has risen to a month and a half high of  USD1.4250  against the pound sterling this afternoon, continuing to advance from Tuesday's low of  USD1.4658  .

 UK  construction output expanded for the first time in four months in April, the  Office for National Statistics  showed Friday. Construction output grew 2.5% on a monthly basis, reversing a 3.6% decline in March. It was also faster than the 1.2% rise forecast by economists.

The greenback has pulled back to around  Y106.625  against the Japanese Yen this afternoon, from an early high of  Y107.259  .

Producer prices in  Japan  were up 0.2% on month in May, the  Bank of Japan  said on Friday. That exceeded expectations for a flat reading following the downwardly revised 0.4% contraction in April.

 Japan's  tertiary activity index increased at a faster-than-expected pace in April after falling in the previous month, figures from the  Ministry of Economy, Trade and Industry  showed Friday. The tertiary activity index rose a seasonally adjusted 1.4% month-over-month in April, exceeding economists' expectations for a 0.6% climb.

Source: KitcoNews