Dollar ends mixed in directionless Tuesday's trading

Market Review - 11/06/2019  23:48GMT  

Dollar ends mixed in directionless Tuesday's trading

The greenback ended mixed on Tuesday as investors await for Group of 20 summit later this month on optimism that United States and China will make progress on trade talks. Sterling rallied in Europe on upbeat UK jobs data.  
  
Versus the Japanese yen, although dollar initially dipped to 108.36 in Australia as U.S.-China trade tension lingered, price found renewed buying and rose to 108.66 at European open on gains in Asian equities before retreating to 108.55. However, the pair then rallied to an 11-day high at 108.80 at New York open before paring its gains on retreat in U.S. Treasury yields and fell to 108.44.  
  
The single currency found renewed buying at 1.1308 and gained to 1.1331 at European morning. Despite retreatting to 1.1303 at New York open, price climedb to session highs of 1.1337 on cross-buying in euro.  
  
Although the British pound remained under pressure in Asia and fell to session lows at 1.2671 at European open on usd's strength, renewed buying emerged and pushed cable to 1.2728 due to upbeat UK jobs data before retreating to 1.2693 at New York open. Later, the pair climbed to 1.2732 on cross-buying in sterling, especially versus euro.  
  
Reuters reported British wages in the three months to April grew faster than expected and hiring slowed less sharply, as the jobless rate held at its lowest rate since 1975, official figures showed on Tuesday.   
  
Total earnings growth, including bonuses, rose by an annual 3.1% in the three months to April, official data showed, slowing from 3.3% in March but beating the median forecast of 3.0% in a Reuters poll of economists, the Office for National Statistics said.   
  
The unemployment rate remained at 3.8% as expected, its joint-lowest since the three months to January 1975, and the absolute number of people out of work dropped by 34,000 to 1.304 million.   
  
The number of people in employment rose by 32,000 to 32.746 million, the smallest increase since the three months to August last year, as employers increasingly say it is hard to find staff.   
  
In other news, Reuters reported Italy's budget deficit can fall to 2.2 percent of gross domestic product this year, Prime Minister Giuseppe Conte said on Tuesday, compared with a 2.4 percent government forecast.   
  
On the data front, Reuters reported U.S. producer prices increased solidly for a second straight month in May, boosted by a surge in the cost of hotel accommodation and gains in a range of other services, pointing to a steady pickup in underlying inflation pressures.   
  
The Labor Department said on Tuesday producer prices excluding food, energy and trade services rose 0.4% last month, matching April's gain. The so-called core PPI increased 2.3% in the 12 months through May after rising 2.2% in April.   
  
Weaker energy and food prices, however, partially offset the increase in services last month. That led to the producer price index for final demand to edge up 0.1% in May after gaining 0.2% in April. In the 12 months through May, the PPI climbed 1.8%, slowing from April's 2.2% advance.   
  
Economists polled by Reuters had forecast the PPI would nudge up 0.1% in May and rise 2.0% on a year-on-year basis.   
  
Data to be released on Wednesday :  
  
New Zealand retail sales, Japan corporate goods price, machinery orders, Australia consumer sentiment, China PPI, CPI, France non-farm payrolls, and U.S. MBA mortgage application, CPI, real weekly earnings, Federal budget.