Forex - Dollar down vs. rivals as spotlight on ECB

Published 12/02/2010, 04:52 AM
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Investing.com – The U.S. dollar was down against all of its major counterparts on Thursday, amid speculation that the European Central Bank was set to take decisive steps to ease fears over sovereign debt contagion in the euro zone.

During European morning trade, the greenback was down against the euro, with EUR/USD climbing 0.32% to hit 1.3181.

As the debt crisis in the euro zone threatened to spill over into Spain, expectations mounted that the ECB would announce an expansion of its bond-buying program or delay the withdrawal of unlimited liquidity support for banks, after its policy meeting on Thursday.

The greenback was also down against the pound with GBP/USD rising 0.16% to hit 1.5646. Earlier Thursday, data showed that the U.K. construction PMI rose unexpectedly in November.

The greenback was also lower against the yen and the Swiss franc, with USD/JPY slipping 0.04% to hit 84.15 and USD/CHF shedding 0.23% to hit 0.9998.

Earlier in the day, official data showed that Swiss gross domestic product increased more-than-expected in the third quarter. A separate report showed that retail sales in Switzerland rose less-than-expected in October.

Elsewhere, official data showed that Japanese capital spending rose 4.8% in the second quarter, increasing for the first time in over three years.

In addition, the greenback was down against its Canadian, Australian and New Zealand counterparts, with USD/CAD shedding 0.33% to hit 1.0133, AUD/USD easing up 0.02% to hit 0.9684 and NZD/USD advancing 0.58% to hit 0.7532

Also Thursday, official data showed that Australian retail sales fell unexpectedly in October.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.20%.

Later in the day, the ECB was to announce its benchmark interest rate. The announcement was to be followed by a press conference. Also Thursday, the U.S. was to publish key weekly data on initial jobless claims as well as a report on pending home sales.

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