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Dollar Stays Weak Against Most Major Currencies

Dollar Stays Weak Against Most Major Currencies
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With the Federal Reserve’s monetary policy review due in another few days, the U.S. dollar stayed subdued against most major currencies on Friday.

After early weakness, the greenback regained some lost ground after data showed a bigger than expected increase in retail sales in the month of August.

The dollar index, which declined to a low of 98.00 earlier in the morning, recovered to around 98.30 by mid-morning, but continued to stay below the flat line. It was last seen quoting at 98.17, down 0.14% from previous close.

Against the Euro, the dollar was down 0.14%, at 1.1078. The dollar had weakened to 1.1111 earlier in the day.

Data from Eurostat showed the euro area trade surplus increased in July on higher exports, rising to a seasonally adjusted EUR 19 billion from EUR 17.7 billion in June. Exports grew 0.6% in July from June, while imports remained stable.

The Pound Sterling gained substantial ground against the greenback, with unit of sterling fetching as much as $1.2505, about 1.5% up from previous close, on rising hopes the U.K. would avoid a no-deal Brexit on October 31 and on possibility that Article 50 being extended till January 2020.

The Japanese yen was at 108.12 a dollar, little changed from previious close.

Final data from the Ministry of Economy, Trade and Industry showed Japan’s industrial production expanded as estimated in July, rising 1.3% in the month.

The dollar gained more than 0.5% against the loonie, with the pair trading at 1.3282.

Against the Aussie, the dollar was down 0.23%, with the pair trading at 0.6882. The Swiss franc was flat at 0.9903.

A report released by the U.S. Commerce Department earlier in the day showed U.S. retail sales increased by more than expected in August thanks to a jump in auto sales.

The report said retail sales rose by 0.4% in August after climbing by an upwardly revised 0.8% in July. Economists had expected retail sales to rise by 0.2% compared to the 0.7% increase originally reported for the previous month.

The stronger than expected retail sales growth came as sales by motor vehicle and parts dealers spiked by 1.8% in August after inching up by 0.1% in July.

Data from the Labor Department showed import prices fell by 0.5% in August after inching up by a downwardly revised 0.1% in July. Economists had expected import prices to drop by 0.4%.

The University of Michigan’s preliminary report said consumer sentiment has rebounded by more than anticipated in the month of September.

The report said the consumer sentiment index rose to 92.0 in September after plunging to a three-year low of 89.8 in August. Economists had expected the index to inch up to 90.9.

The bigger than expected rebound by the headline index came as the index of current economic conditions crept up to 106.9 in September from 105.3 in August and the index of consumer expectations climbed to 82.4 from 79.9.

The material has been provided by InstaForex Company – www.instaforex.com