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Market Review - 05/05/2009 21:27 GMT
Euro retreats from one-month high versus U.S. dollar as ECB's meeting approaches
The single currency fell from a one-month high of 1.3439 against the greenback on Tuesday as investors took profits ahead of a European Central Bank meeting later this week and as worries about U.S. banks dampened some of the optimism over a possible economic recovery. In late New York trading, the euro declined sharply and dropped to session lows of 1.3282, 0.8828 and 131.54 versus the dollar, sterling and Japanese yen respectively.
The dollar pared its early losses as falling U.S. equity markets reignited safe-haven buying for the greenback. In late New York session, the ICE dollar index (which measure the dollar’s strength against a basket of six other currencies) rose the first time in three days and was trading up 0.48 percent at 84.069.
Australia's central bank kept its benchmark interest rate unchanged at 3 percent yesterday, after cutting rates six times in the last eight months, to gauge whether the lowest borrowing costs in 49 years and government spending will pull the economy out of its first recession in two decades. The Australian dollar rose from 0.7378 against the dollar after the announcement and touched a session high of 0.7480 in New York morning before retreating on the greenback’s broad-based rebound.
On the data front, producer prices in Europe dropped the most in 22 years in March, falling 3.1 percent from a year earlier, after a 1.7 percent drop in February and steeper than the consensus forecast of a 2.9 percent decline. A separate report from U.S. showed that Institute for Supply Management’s index of non-manufacturing businesses in April rose to 43.7 from 40.8 the prior month, higher than economists’ consensus forecast of 42.0 as home purchases and retail sales rose.
Federal Reserve Chairman Ben S. Bernanke testified before the Joint Economic Committee about the economic outlook on Tuesday and said the U.S. economy was on track for a recovery but said the rebound would be slow and the jobless rate would still rise.
Economic data releases on Wednesday include U.K. Nationwide consumer confidence and PMI service, Australia trade balance and retail sales, German PMI service, eurozone PMI service, Canada Ivey PMI and building permits, U.S. ADP employment, and New Zealand unemployment rate.
Euro retreats from one-month high versus U.S. dollar as ECB's meeting approaches
The single currency fell from a one-month high of 1.3439 against the greenback on Tuesday as investors took profits ahead of a European Central Bank meeting later this week and as worries about U.S. banks dampened some of the optimism over a possible economic recovery. In late New York trading, the euro declined sharply and dropped to session lows of 1.3282, 0.8828 and 131.54 versus the dollar, sterling and Japanese yen respectively.
The dollar pared its early losses as falling U.S. equity markets reignited safe-haven buying for the greenback. In late New York session, the ICE dollar index (which measure the dollar’s strength against a basket of six other currencies) rose the first time in three days and was trading up 0.48 percent at 84.069.
Australia's central bank kept its benchmark interest rate unchanged at 3 percent yesterday, after cutting rates six times in the last eight months, to gauge whether the lowest borrowing costs in 49 years and government spending will pull the economy out of its first recession in two decades. The Australian dollar rose from 0.7378 against the dollar after the announcement and touched a session high of 0.7480 in New York morning before retreating on the greenback’s broad-based rebound.
On the data front, producer prices in Europe dropped the most in 22 years in March, falling 3.1 percent from a year earlier, after a 1.7 percent drop in February and steeper than the consensus forecast of a 2.9 percent decline. A separate report from U.S. showed that Institute for Supply Management’s index of non-manufacturing businesses in April rose to 43.7 from 40.8 the prior month, higher than economists’ consensus forecast of 42.0 as home purchases and retail sales rose.
Federal Reserve Chairman Ben S. Bernanke testified before the Joint Economic Committee about the economic outlook on Tuesday and said the U.S. economy was on track for a recovery but said the rebound would be slow and the jobless rate would still rise.
Economic data releases on Wednesday include U.K. Nationwide consumer confidence and PMI service, Australia trade balance and retail sales, German PMI service, eurozone PMI service, Canada Ivey PMI and building permits, U.S. ADP employment, and New Zealand unemployment rate.
