Dollar broadly higher after Spanish bond auction

Published 11/08/2012, 05:28 AM
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Investing.com - The U.S. dollar was broadly higher against the other major currencies on Thursday, after a successful Spanish bond auction eased pressure on Spain to request a bailout this year, while concerns over the U.S. fiscal policy also supported safe haven demand.

During European morning trade, the dollar was at a two-month high against the euro, with EUR/USD down 0.38% to 1.2723.

The euro weakened broadly after Spain sold EUR4.76 billion of three-year, five-year and 20-year bonds, which will allow the country to meet its financing requirements for 2012.

Market sentiment was also hit by concerns over the U.S. fiscal cliff, automatic tax hikes and spending cuts due to come into effect on January 1 unless lawmakers can reach an agreement, which could threaten U.S. and global growth.

Greece’s parliament narrowly approved fresh austerity measures required to secure the next installment of bailout funds late Wednesday, but the measures were likely to exacerbate the country’s recession.

The greenback was higher against the pound, with GBP/USD falling 0.31% to 1.5935.

Elsewhere, the greenback was slightly lower against the yen, with USD/JPY slipping 0.12% to 79.90, but was higher against the Swiss franc, with USD/CHF up 0.26% to 0.9471.

In Japan, official data showed that the current account posted a seasonally adjusted deficit of JPY142.0 billion in September as export demand weakened.

The greenback was little changed against its Canadian, Australian and New Zealand counterparts, with USD/CAD inching up 0.05% to 0.9973, AUD/USD inching down 0.07% to 1.0403 and NZD/USD down 0.32% to 0.8158.

Official data earlier showed that the Australian economy added 10,700 jobs in October, far more than the expected 200 increase, while the unemployment rate remained unchanged at 5.4%, beating expectations for a rise to 5.5%.

In New Zealand, government data showed that the unemployment rate jumped to 7.3% in the third quarter, up from 6.8% in the previous quarter and a 13-year high.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.25% to 81.08.

Investors were looking ahead to the European Central Bank's policy-setting meeting and President Mario Draghi's press conference later in the day.

In addition, the U.S. was to publish official data on the trade balance as well as the weekly government report on initial jobless claims.



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