Dollar Turning In Mixed Performance After Mixed Economic Reports

(RTTNews) - The dollar is currently rising against the Euro and the Japanese Yen Friday afternoon, but is losing ground against the pound sterling. There were a number of U.S. economic reports released this morning, the results of which proved mixed.

Economic growth slowed by even more than previously estimated in the final three months of 2014, according to a revised report released by the Commerce Department on Friday.

The report said U.S. gross domestic product increased by a downwardly revised 2.2 percent in the fourth quarter compared to the previously reported 2.6 percent growth. The growth represents a notable slowdown from the 5.0 percent jump seen in the third quarter.

Despite the downward revision, the pace of GDP growth during the fourth quarter still came in slightly above economist estimates for a 2.1 percent increase.

Business activity in the Chicago area unexpectedly contracted in the month of February, according to a report released by MNI Indicators on Friday. MNI Indicators said its Chicago business barometer tumbled to 45.8 in February from 59.4 in January, with a reading below 50 indicating a contraction in regional business activity.

Economists had expected the business barometer to show a much more modest decrease to a reading of about 58.7. With the much bigger than expected decrease, the business barometer fell to its lowest level since July of 2009 and pointed to the first contraction since April of 2013.

Consumer sentiment in the U.S. deteriorated by less than previously estimated in the month of February, the University of Michigan revealed in a report on Friday.

The report said the final reading on the consumer sentiment index for February came in at 95.4 compared to the preliminary reading of 93.6. The upwardly revised reading came in well above economist estimates of 94.0 but remained below the eleven-year high of 98.1 set in January.

Pending home sales in the U.S. rebounded in the month of January, according to a report released by the National Association of Realtors on Friday, with the increase reflecting improved buyer demand. NAR said its pending home sales index climbed 1.7 percent to 104.2 in January after falling 1.5 percent to an upwardly revised 102.5 in December.

William C. Dudley, New York Federal Reserve President today urged caution on raising interest rates, citing uncertainty about the sustainability of the U.S. economic recovery.

"I do think that the real potential GDP growth rate will be lower over the medium term, held down by much slower growth of labor input and an anticipated continuation of lackluster productivity growth performance," Dudley said at the 2015 Monetary Policy Forum.

While Dudley sees little risk in keeping rates near zero, a number of his Fed colleagues have hinted they are comfortable with a rate mid-year as long as incoming economic data shows the recovery hasn't petered out.

The German parliament approved a four-month extension of Greek bailout program Friday. Despite widespread skepticism in the country, the German legislators voted for the bailout extension with overwhelming majority. 542 members of the Deutsch Bundestag voted for the proposals, 32 MPs voted against it, while 13 members abstained from voting.

Eurogroup last week agreed to a request by the Greek Government to extend the EUR240 billion bailout program until June in exchange for a series of economic reforms. The extension will have legal validity only if it is ratified by all eurozone member states.

The dollar slipped to a low of $1.1245 against the Euro Friday, but has since bounced back to around $1.1200 this afternoon.

Germany's consumer prices in February rose unexpectedly from a year ago, after declining for the first time in more than five years in the previous month, preliminary data from Destatis revealed Friday.

The consumer price index rose 0.1 percent year-on-year following 0.4 percent fall in January. Economists had forecast a 0.3 percent decline. The January decrease was the first since September 2009.

Germany's import prices declined at a slower-than-expected pace in January, yet logged its worst fall in more than five years, figures from Destatis showed Friday. The import price index fell 4.4 percent year-on-year at the start of the year, faster than December's 3.7 percent decline. Economists had forecast a 4.6 percent fall for the month.

France's consumer spending grew for the third straight month in January, defying expectations for a fall, figures from the statistical office INSEE showed Friday. Consumer spending rose 0.6 percent from December, when it grew 1.6 percent, which was revised from 1.5 percent. Economists had predicted a 0.3 percent decline.

France's producer prices declined at the start of the year, figures from the statistical office INSEE showed Friday. The producer price index for the French market fell 3.3 percent year-on-year in January. On a monthly basis, producer prices dropped 0.9 percent in January, the same rate of decrease as in the previous month.

The buck rose to an early high of $1.5384 against the pound sterling Friday, but has since pulled back to around $1.5445.

Consumer confidence in the United Kingdom held fast in February, the latest survey from research firm GfK showed on Friday with an index score of +1. That was unchanged from the January reading, although it was shy of expectations for +2.

U.K. house prices grew at the slowest pace in nine months in January, the Land Registry reported Friday. House prices grew 6.7 percent year-on-year in January, the same rate of growth as seen in December. The 6.7 percent increase was the weakest growth since last April, when prices gained 6.4 percent.

The greenback hovered around the Y119.300 level against the Japanese Yen early Friday, but has broken out to a 2-day high of Y119.692 in the afternoon.

The jobless rate in Japan came in at a seasonally adjusted 3.6 percent in January, the Ministry of Internal Affairs and Communications said on Friday. That missed forecasts for 3.4 percent, which would have been unchanged from the December reading.

The average of household spending in Japan was down 5.1 percent on year in January, the Ministry of Internal Affairs and Communications said on Friday, standing at 289,847 yen. That missed forecasts for a decline of 4.1 percent following the 3.4 percent contraction in December.

Consumer prices in Japan were up 2.4 percent on year in January, the Ministry of Internal Affairs and Communications said on Friday - in line with expectations and unchanged from the December reading. Core consumer prices were up 2.2 percent on year, below forecasts for 2.3 percent and down from 2.5 percent.

Industrial production in Japan was up 4.0 percent on month in January, the Ministry of Economy, Trade and Industry said on Friday. That beat forecasts for an increase of 2.7 percent following the 0.8 percent increase in December.

The total value of retail sales in Japan was down 2.0 percent on year in January, the Ministry of Economy, Trade and Industry said on Friday - coming in at 11.485 trillion yen. That missed forecasts for a decline of 1.2 percent following the 0.1 percent gain in December.

Japan housing starts declined more than expected in January, data from the Ministry of Land, Infrastructure, Transport and Tourism showed Friday. Housing starts decreased 13 percent year-on-year in January, faster than an expected 11.6 percent fall. Housing starts declined for eleven consecutive months. Nonetheless, the rate of decline was smaller than December's 14.7 percent fall.

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