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Dollar pushes higher after positive U.S. data

Published 03/30/2015, 08:40 AM
© Reuters. Dollar extends gains vs. counterparts as U.S. data supports
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Investing.com - The dollar pushed higher against a basket of other major currencies on Monday, after the release of positive U.S. economic reports on personal spending and income and as investors eyed upcoming data on U.S. pending home sales.

In a report, the U.S. Commerce Department said that personal spending inched up 0.1% last month, below expectations for a gain of 0.2%. Personal spending dropped 0.2% in January.

The report also showed personal income rose 0.4% in February, above forecasts for a 0.3% increase and after gaining 0.4% in January.

The dollar also remained supported after Federal Reserve Chair Janet Yellen said in a speech on Friday that a rate hike may be warranted later this year, but added that weakening inflation pressures could force the Fed to delay.

Ms. Yellen said policy tightening could "speed up, slow down, pause, or even reverse course" depending on how the economy is performing.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.49% to 98.08.

EUR/USD dropped 0.46% to 1.0840.

The euro shrugged off official data showing that German consumer price inflation accelerated at an annualized rate of 0.3% this month, meeting forecasts and compared to a reading of 0.1% in February.

Another report showed that consumer prices in Spain fell 0.7% this month, compared to expectations for a decline of 1.0%, after a 1.1% decline in February.

Meanwhile, Greece remained in focus after Prime Minister Alexis Tsipras’ government put forward new reform plans for approval late Friday, as part of a bailout extension review.

Officials from the European Union, the International Monetary Fund and the European Central Bank were to examine the measures after earlier proposals were not accepted.

The pound was also lower, with GBP/USD down 0.70% to 1.4786.

In the U.K., the Bank of England said on Monday that total net lending to individuals increased by ₤2.5 billion last month, meeting forecasts and up from ₤2.4 billion in January.

In another report, the central bank said U.K. mortgage approvals rose to a six-month high last month, indicating that the housing market is picking up.

Elsewhere, the dollar was higher against the yen and the Swiss franc, with USD/JPY climbing 0.63% to 119.90 and with USD/CHF edging up 0.12% to 0.9635.

The KOF Economic Research Agency earlier reported that its index of 219 economic indicators for Switzerland inched up to 90.8 this month from a reading of 90.3 in February. Analysts had expected the economic barometer to dip to 89.1 in March.

Also Monday, preliminary data showed that Japan's industrial production dropped 3.4% in February, exceeding expectations for a 1.8% fall, after a 3.7% increase the previous month.

The Australian, New Zealand and Canadian dollars were broadly weaker, with AUD/USD tumbling 1.23% to 0.7661 and NZD/USD retreating 0.53% to 0.7525, while USD/CAD rose 0.28% to 1.2643.

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