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Forex - Dollar broadly lower as euro advances on rate outlook

Published 03/31/2011, 06:26 AM
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Investing.com – The U.S. dollar was broadly weaker against its major counterparts on Thursday, while the euro advanced after data showing euro zone inflation unexpectedly accelerated in March, bolstering the case for tighter monetary policy.

During European morning trade, the greenback was down against the euro, with EUR/USD rising 0.63% to hit 1.4215.

Earlier in the day, Eurostat said consumer price inflation was expected to rise by a seasonally adjusted 2.6% in March, after rising by 2.4% in February. Analysts had expected euro zone CPI to remain unchanged this month.

The greenback was also lower against the pound, with GBP/USD climbing 0.15% to hit 1.6098.

Nationwide Building Society said earlier that U.K. house prices rose unexpectedly for a second consecutive month in March, while the Bank of England’s quarterly credit conditions survey showed that credit conditions look set to ease slightly in the next three months.

Elsewhere, the greenback was fractionally higher against the yen but lower against the Swiss franc with USD/JPY easing up 0.03% to hit 82.91 and USD/CHF shedding 0.26% to hit 0.9158.

Meanwhile, the greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD slipping 0.11% to hit 0.9697, AUD/USD easing up 0.11% to hit 1.0338 and NZD/USD edging up 0.03% to hit 0.7623.

Earlier Thursday, official data showed that Australian retail sales rose more-than-expected in February but a separate report showed that building permits fell sharply last month.

Meanwhile, the National Bank of New Zealand said its business confidence survey posted the second largest one-month decline in its history in the wake of the February 22 earthquake in Christchurch.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.40%.

Later in the day, the U.S. was to publish a government report on initial jobless claims.


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