U.S. Dollar Extends Fall Amid Bets On Fed's Rate Cut
16 April 2015 - 4:09PM
RTTF2
The U.S. dollar continued to be weaker against the other major
currencies in the Asian session on Thursday, as weak U.S. economic
data arose uncertainty over the timing of the Federal Reserve's
interest rate hike.
The Federal Reserve's report on Wednesday showed U.S. industrial
production to have dropped more than expected in March. The Fed
said industrial production fell 0.6 percent in March after inching
up 0.1 percent in February. Economists expected production to drop
by 0.3 percent.
Meanwhile, manufacturing activity in New York unexpectedly
contracted in April, due partly to continued decline in new orders,
with the index turning negative for the first time since last
December.The New York Fed's general business conditions index
dropped to a negative 1.2 in April from a positive 6.9 in March,
with a negative reading indicating a contraction in regional
manufacturing activity.
The index turned negative for the first time since last
December, surprising economists, who had expected the index to inch
up to 7.0.
The market now focus on U.S. housing data later in the day, for
further clues.
Wednesday, the U.S. dollar fell against its most major rivals.
The U.S. dollar fell 0.34 percent against the pound, 0.20 percent
against the yen and 0.81 percent against the Swiss franc.
In the Asian trading today, the U.S. dollar fell to 1.2249
against the Canadian dollar for the first time since January 21,
from yesterday's closing value of 1.2288. If the greenback extends
its downtrend, it is likely to find support around the 1.17
area.
Against the euro and the pound, the greenback dropped to 1-week
low of 1.0746 and 1.4879 from yesterday's closing quotes of 1.0682
and 1.4837, respectively. On the downside, 1.10 against the euro
and 1.52 against the pound are seen as the next support level for
the greenback.
The greenback slipped to an 8-day low of 0.9605 against the
Swiss franc, from yesterday's closing value of 0.9640. The
greenback may test support near the 0.94 region.
Against the Australia and the New Zealand dollars, the greenback
slid to nearly a 3-week low of 0.7781 and a 3-week low of 0.7637
from yesterday's closing quotes of 0.7674 and 0.7584, respectively.
The greenback is likely to find support near 0.80 against the
aussie and 0.77 against the kiwi.
The greenback edged down to 118.78 against the yen. At
yesterday's close, the greenback was trading at 119.12 against the
yen. The next possible downside target for the greenback is seen at
116.98 level.
Looking ahead, Swiss producer and import prices for March is due
to be released at 3:15 am ET.
In the New York session, U.S. building permits and housing
starts - both for March, U.S. weekly jobless claims for the week
ended April 11 and Reserve Bank of Philadelphia's manufacturing
index for April are slated for release.
At 1:00 am ET, Federal Reserve Bank of Atlanta President Dennis
Lockhart will deliver a speech about the US economic outlook and
monetary policy at the Palm Beach County Convention Center.
After 10 minutes, Federal Reserve Bank of Cleveland President
Loretta Mester will speak on the economy before the Forecasters
Club of New York.
Subsequently, Federal Reserve Bank of Boston President Eric
Rosengren participates in "The U.S. Economic Outlook and
Implications for Monetary Policy" event hosted by Chatham House in
London at 1:30 pm ET.
At 3:00 pm ET, Federal Reserve Governor Stanley Fischer will
participate in a panel discussion titled "The Elusive Pursuit of
Inflation" at the International Monetary Fund Spring Meetings in
Washington DC at 3:00 pm ET.
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