Dollar rebounds on month-end demand

The greenback erased its intra-day losses and ended the day higher against majority of its peers on Monday due partly to profit-taking together with a selloff in U.S. stocks. (Dow ended the day at 29,638 down by 271 points or 0.91%).  
  
On the data front, Reuters reported contracts to buy U.S. previously owned homes fell for a second straight month in October as an acute shortage of properties pushed up prices, though the housing market remains supported by record low mortgage rates.  
The National Association of Realtors said its Pending Home Sales Index, based on contracts signed last month, decreased 1.1% to 128.9. Economists polled by Reuters had forecast pending home contracts, which become sales after a month or two, would rebound 1.0% in October.  
  
Reuters reported the U.S. recovery is facing near term risks from the surging number of coronavirus cases and the end of unemployment benefits for many workers, but there are better medium term prospects with a vaccine on the horizon, Richmond Federal Reserve bank president Thomas Barkin said on Monday.      "Lets see what happens," Barkin said when asked if the Fed needed to step in with more monetary stimulus, perhaps by changing its bond purchase program. "The virus is definitely escalating," he said in webcast remarks to the Darla Moore School of Business at the University of South Carolina, but "it is hard to find a huge drop" in real time measures of consumer spending and other data.  
  
Versus the Japanese yen, dollar met renewed selling at 104.16 ahead of Asian open and dropped to session lows at 103.84 in Asian morning due partly to cross-buying in jpy. However, the pair then rebounded strongly to 104.34 in European morning before retreating sharply to 103.92. Price later climbed to day's high at 104.40 near New York close on usd's broad-based rebound.  
  
The single currency traded with a firm bias in Asia and gained to 1.1976 ahead of European open. The pair then ratcheted higher a fresh 12-week peak at 1.200+ in New York morning on the return of risk sentiment before falling to session lows at 1.1925 in New York on prfoit taking as the greenback caught a bid in New York afternoon trading.  
  
The British pound opened higher to 1.3339 before retreating to 1.3314 in New Zealand on weekend Brexit headlines. The pair then found renewed buying there and gained to 1.3357 at European open before falling to session lows at 1.3305 in European morning on cross-selling of sterling especially vs euro. Later, cable rose to 1.3384 in New York morning before retreating to 1.3317 in tandem with euro.    

On Brexit news, Reuters reported Britain wants to reach a free trade agreement with the European Union "as soon as possible" but will not be changing its negotiating position, a spokesman for Prime Minister Boris Johnson said on Monday.        Talks on securing a Brexit trade deal went on until late on Sunday and continue in London on Monday.     "We want to try and reach a free trade agreement as soon as possible but we've been clear we won't change our negotiating position," the spokesman told reporters. "Although there has been some progress, there still remains divergence on issues (such as) fisheries and the level playing field."  
  
Data to be released on Tuesday :  
  
Japan unemployment rate, manufacturing PMI, Australia building permits, current account, RBA interest rate decision, Swiss GDP, manufacturing PMI, Italy manufacturing PMI, GDP, France manufacturing PMI, Germany manufacturing PMI, EU manufacturing PMI, HICP, Canada GDP, manufacturing PMI, U.S. redbook retail sales, manufacturing PMI, construction spending and ISM manufacturing PMI.