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Dollar broadly higher vs. rivals, U.S. data ahead

Published 08/23/2013, 05:27 AM
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Investing.com - The U.S. dollar was broadly higher against the other major currencies on Friday, supported by growing expectations for a near-term end to the Federal Reserve's stimulus program, while investors eyed the release of U.S. new home sales data later in the day.

During European morning trade, the dollar was steady against the euro, with EUR/USD inching 0.03% higher to 1.3359.

The greenback remained supported after the minutes of the Fed’s July meeting on Wednesday showed that officials were "broadly comfortable" with plans to start unwinding the bank’s USD85 billion-a-month bond buying program.

However, officials remain divided over the timing of possible reduction, with almost all committee members agreeing that a change in the asset purchase program was not yet appropriate.

The minutes described recent U.S. economic data as “mixed”, indicating that plans to taper could be pushed back if the economy was to weaken.

The greenback was lower against the pound, with GBP/USD adding 0.23% to 1.5621.

The pound strengthened after official data showed that the U.K. gross domestic product grew by 0.7% in the second quarter, higher than expectations for a 0.6% expansion.

Separately, the U.K. Office for National Statistics said, in a preliminary report, that business invest rose 0.9% in the last quarter, beating expectations for a 0.6% increase, after a 1.9% decline in the three months to March.

Data also showed that mortgage approvals in the U.K. rose less-than-expected in July, rising by GBP37,200 after a GBP37,300 increase the previous month. Analysts had expected mortgage approvals to rise by GBP38,800 last month.

Elsewhere, the greenback was higher against the yen and the Swiss franc, with USD/JPY edging up 0.19% to trade at 98.91, and with USD/CHF gaining 0.15% to 0.9246.

The greenback was higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD rising 0.38% to 1.0558, AUD/USD easing 0.08% to 0.8997 and NZD/USD shedding 0.39% to 0.7798.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.06% to 81.55.

Later in the day, the U.S. was to release official data on new home sales.


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