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Forex - Dollar mixed vs. rivals as U.K. GDP data sparks risk aversion

Published 01/25/2011, 07:35 AM
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Investing.com – The U.S. dollar was mixed against its major counterparts on Tuesday, after data showing that Britain’s economy contracted unexpectedly in the final quarter sparked renewed concerns over the global economic recovery.

During European early afternoon trade, the greenback was up against the euro, with EUR/USD sliding 0.11% to hit 1.362.

Earlier in the day, the order book for the European Financial Stability Facility's inaugural debt issue closed with bids valued at EUR43 billion for the EUR5 billion of bonds offered. Separately, Spain sold EUR2.2 billion in Treasury bills.

Meanwhile, the greenback was sharply higher against sterling with GBP/USD tumbling 1.26% to hit 1.5784.

The U.K. Office for National Statistics said fourth-quarter gross domestic product declined by 0.5% compared to the previous quarter, marking the first decline since the third quarter of 2009 and defying forecasts for a 0.5% rise.

Elsewhere, the greenback was down against the yen and the Swiss franc, with USD/JPY sliding 0.17% to hit 82.38 and USD/CHF shedding 0.26% to hit 0.9465.

Earlier in the day, the Bank of Japan raised its economic growth forecast for the 2010 fiscal year to 3.3%, compared to a previous estimate of 2.1%.

Meanwhile, the greenback was up against its Canadian and Australian counterparts but down against its New Zealand cousin, with USD/CAD advancing 0.49% to hit 0.9984, AUD/USD falling 0.41% to hit 0.9932 and NZD/USD easing up 0.03% to hit 0.7634.

Earlier Tuesday, official data showed that Australia’s consumer price index rose less-than-expected in the final quarter, rising at the slowest pace in almost two years.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.24%.

Later Tuesday, the U.S. was to publish industry data on house prices as well as a report on consumer confidence.


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