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Dollar extends losses vs. rivals after tepid U.S. data

Published 04/29/2016, 08:40 AM
© Reuters.  Dollar pushes lower vs. other majors, more U.S. data ahead
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Investing.com - The dollar extended losses against the other major currencies on Friday, after the release of tepid U.S. economic reports and as markets continued to digest policy decisions by the Bank of Japan and the Federal Reserve.

USD/JPY was down 0.75% at one-and-a-half year low of 107.28.

The U.S. Commerce Department said that personal spending increased by 0.1% last month, worse than expectations for a 0.2% increase, while February’s number was revised up to a gain of 0.2% from a previously reported rise of 0.1%.

Personal income, meanwhile, rose 0.4% in March, above forecasts for a 0.3% gain and after rising 0.1% a month earlier.

The core PCE price index inched up 0.1% last month, in line with expectations and after rising 0.2% in February.

Meanwhile, the yen remained broadly supported after the BoJ chose on Thursday to hold its monetary policy, defying market expectations for additional monetary easing.

The decision came a day after the Fed left interest rates unchanged close to zero on Wednesday and offered little guidance on future rate hikes.

EUR/USD gained 0.64% to 1.1425, the highest since April 12.

Eurostat reported on Friday that the euro area’s gross domestic product rose 0.6% in the first quarter, up from 0.3% in the three months to December and beating expectations for a growth rate of 0.4%.

On a year-on-year basis, the bloc’s GDP rose 1.6% in the first quarter, exceeding expectations for an expansion of 1.4% and unchanged from the previous quarter.

A separate report showed that euro zone consumer price inflation fell by 0.2% this month, worse than expectations for a 0.1% decline, and following a final reading of 0.0% in March.

Core CPI, which excludes food, energy, alcohol, and tobacco costs increased by 0.8% in April, below forecasts for 0.9% and down from 1.0% a month earlier.

The dollar was lower against the pound and the Swiss franc, with GBP/USD up 0.22% at 1.4642 and with USD/CHF dropping 0.55% to 0.9615.

In the U.K., official data showed that net lending to individuals rose by £9.3 billion in March, beating expectations for an increase of £5.0 billion.

Data also showed that U.K. mortgage approvals rose by 71,360 last month, compared to expectations for an increase of 74,500.

Meanwhile, the KOF economic barometer for Switzerland ticked down to 102.7 in April from an upwardly revised reading of 102.8 in March, data showed.

The data came shortly before Swiss National Bank President Thomas Jordan reiterated that the Swiss franc remains overvalued.

The Australian and New Zealand dollars were stronger, with AUD/USD up 0.28% at 0.7647 and with NZD/USD advancing 0.49% to 0.6997.

Elsewhere, USD/CAD slid 0.38% to a fresh nine-month low of 1.2507 after data showed that Canada’s GDP fell 0.1% in February, in line with expectations and after 0.6% rise the previous month.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.61% at 93.16, the lowest since August 2015.

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