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Dollar extends gains vs. rivals as data adds to Fed uncertainty

Published 12/23/2015, 09:10 AM
© Reuters.  U.S. dollar adds to gains after data deluge
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Investing.com - The dollar added to gains against its major rivals on Wednesday, as a flurry of mixed U.S. data failed to offer clues as to how fast the Federal Reserve will raise interest rates next year.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.25% at 98.46 during U.S. morning hours.

The U.S. Commerce Department said that durable goods orders, which include transportation items, were unchanged last month, compared to forecasts for a decline of 0.6%. Core durable goods orders, excluding volatile transportation items, fell by 0.1% in November, disappointing expectations for a gain of 0.1%.

Orders for core capital goods, a key barometer of private-sector business investment, decreased 0.4% last month, worse than expectations for a decline of 0.1%, while shipments of core capital goods, a category used to calculate quarterly economic growth, decreased 0.5% in November, confounding forecasts for a gain of 0.5%.

A separate report showed that personal spending inched up 0.3% last month, meeting forecasts. Personal income, meanwhile, rose 0.3%, above forecasts for a 0.2% gain.

The core PCE price index rose 0.1% last month. On an annualized rate, the core PCE price index increased 1.3%. The Fed uses core PCE as a tool to help determine whether to raise or lower interest rates, with the aim of keeping inflation at a rate of 2% or below.

Trading volumes are expected to remain light as many traders already closed books before the end of the year, reducing liquidity in the market and increasing volatility. U.S. markets close early Thursday, Christmas Eve, and are shut Friday for Christmas Day.

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