The greenback hit 4-week lows against majority of its peers on Friday as speculation that the Federal Reserve will maintain its accomodative monetary policy and gain in U.S. stocks (S&P 500 and Dow climbed to record highs on upbeat bank earnings) boosted risk appetite and triggered broad-based weakness in usd.
On the data front, Reuters reported U.S. consumer sentiment increased to a one-year high in early April amid strengthening economic growth, though households worried about inflation heating up this year, according to a survey released on Friday. The University of Michigan said its preliminary consumer sentiment index rose to 86.5 in the first half of this month from a final reading of 84.9 in March. Economists polled by Reuters had forecast the index rising to 89.6. The survey's barometer of current economic conditions increased to a reading of 97.2 from 93.0 in March. Its measure of consumer expectations was unchanged at 79.7.
Versus the Japanese yen, the dollar rebounded from 108.62 in Asia to 108.93 before edging higher to session highs of 108.96 in European morning. The pair then retreated to 108.71 and moved narrowly in New York session.
The single currency initially fell from 1.1974 to session lows of 1.1951 in Asia on profit taking, however, euro then found renewed buying and ratcheted higher to a fresh 5-week high of 1.1994 in Europe on usd's broad-based weakness and moved sideways in New York due to cross-selling in euro versus sterling, price last traded at 1.1983 near the close.
The British pound met renewed selling at 1.3787 in Australia and fell to 1.3717 at European open. Cable then erased intra-day losses and rallied to a 1-week high of 1.3845 near New York close due to active cross-buying in sterling especially versus euro and yen.
Data to be released this week :
U.K. rightmove house price, Japan exports, imports, trade balance, industrial output, capacity utilization, industrial output, EU construction output, current account on Monday.
Japan tertiary industry index, Germany producer prices, U.K. claimant count, ILO unemployment rate, employment change, average weekly earnings, U.S. redbook on Tuesday.
New Zealand GDT price index, CPI, Australia Westpac leading index, retail sales, U.K. CPI, RPI, PPI input prices, PPI output prices, DCLG house price index, U.S. mortgage app, Canada CPI, CPI BoC core, BoC interest rate decision on Wednesday.
Swiss trade balance, exports, imports, France business climate, Germany markit manufacturing PMI, markit services PMI, Ifo business climate, Ifo current conditions, Ifo expectations, Italy industrial sales, EU markit manufacturing PMI, markit services PMI, ECB refinancing rate, ECB deposit rate, consumer confidence, U.K. CBI trends orders, U.S. initial jobless claims, continuous jobless claims, exiting home sales, leading index change, KC Fed manufacturing index, Canada new housing price index on Thursday.
Australia manufacturing PMI, services PMI, Japan nationwide CPI, Jibun Bank manufacturing PMI, U.K. Gfk consumer confidence, PSNB GBP, PSNCR GBP, retail sales, markit manufacturing PMI, markit services PMI, France markit manufacturing PMI, markit services PMI, consumer confidence, Germany markit manufacturing PMI, markit services PMI, EU markit manufacturing PMI, markit services PMI, U.S. building permits, markit manufacturing PMI, markit services PMI, new homes sales on Friday.
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