U.S. Dollar Advances As Retail Sales Improve
12 February 2016 - 8:15PM
RTTF2
The U.S. dollar was trading in a positive territory against its
major rivals in European deals on Friday, after retail sales rose
slightly more than anticipated in January, partly led by an
increase in auto sales.
Data from the Commerce Department showed that retail sales
climbed by 0.2 percent in January compared to economist estimates
for a 0.1 percent uptick.
The report also showed that retail sales in December rose by an
upwardly revised 0.2 percent.
Excluding auto sales, retail sales inched up by 0.1 percent in
January, matching the revised increase in December. Economists had
expected ex-auto sales to come in unchanged.
Meanwhile, data from the the Labor Department showed a notable
decrease in U.S. import prices in the month of January, mainly due
to another steep drop in fuel prices.
The report said import prices tumbled by 1.1 percent in January,
matching the revised decrease reported for December. Economists had
expected import prices to slump by 1.5 percent.
The Labor Department also said export prices slid by 0.8 percent
in January after plunging by 1.1 percent in the previous month.
Export prices had been expected to drop by 0.6 percent.
The prospectus for a March rate hike has receded after the Fed
Chair Janet Yellen sounded cautious about the state of global
economy in her Congressional testimony and indicated weak growth
across the globe would have spillover effects in U.S. economic
growth and slow the pace of Fed rate hikes.
The greenback showed mixed performance in Asian deals. While the
currency held steady against the euro and the pound, it climbed
against the franc. Against the yen, it declined.
The greenback bounced to 1.4484 against the pound, from a 2-day
low of 1.4570 hit at 5:10 am ET. The greenback is likely to find
resistance around the 1.42 zone.
Figures from the Office for National Statistics showed that
British construction output grew at a slower-than-expected pace in
December, after falling in the previous month.
Construction output rose 1.5 percent month-over-month in
December, reversing a 1.1 percent drop in November. The expected
rate of increase was 2.0 percent.
The greenback advanced to 2-day highs of 1.1228 against the euro
and 0.9781 against the franc, compared to Thursday's closing values
of 1.1322 and 0.9722, respectively. If the greenback extends rise,
it may locate resistance near 1.10 against the euro and 0.99
against the franc.
After a brief pause, the greenback rose back to 113.16 against
the Japanese yen. Further gains may take the greenback to a
resistance around the 116.00 level.
The greenback climbed to 0.6643 against the NZ dollar, after
having fallen to a weekly low of 0.6739 at 5:45 pm ET. On the
upside, 0.65 is possibly seen as the next resistance level for the
greenback.
U.S. business inventories report for December and preliminary
consumer sentiment index for February are due shortly.
New York Federal Reserve William Dudley will attend a press
conference on household debt and credit report in New York at 10 am
ET.
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