Forex- Dollar mostly higher in Asia as cliff talks turn south

Published 12/19/2012, 09:52 PM
Updated 12/19/2012, 09:54 PM
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Investing.com - The U.S. dollar was higher against most of its major rivals in Thursday’s Asian sessions as traders sought safer assets on news that U.S. fiscal cliff negotiations have taken a turn for the worse.

In Asian trading Thursday, EUR/USD was off 0.06% at 1.3220. The pair was likely to find support at 1.3144, Monday's low, and resistance at 1.3308, the earlier high.

EUR/USD got a lift during Wednesday’s European and U.S. sessions on the back of some positive economic news out of Germany. The Ifo economic institute's German business climate index came hit 102.4 for December, up from 101.4 in November and beating market forecasts for a 102.0 reading. Germany is the Eurozone’s largest economy.

Elsewhere, the Commerce Department said new home construction fell 3% last month to a seasonally adjusted rate of 861,000 units. Economists expected a reading of 865,000 units. The October number was revised down to 888,000 from an initial reading of 894,000.

The dollar gained steam against some of the other major currencies as traders showed their disappointment about the stalling fiscal cliff talks.

USD/CHF gained 0.02% to 0.9136, but the dollar was spotted lower against sterling as GBP/USD added 0.05% to 1.6257. USD/CAD was flat at 0.9890.

With traders pondering the next move by the Bank of the Japan on the monetary easing front, USD/JPY was lower by 0.24% at 84.21. The central bank concludes its two-day meeting today and most traders are expecting an announcement regarding further asset-buying. With Japanese interest rates at historic lows, BoJ is unlikely to make a rate cut announcement.

Looking at the dollar against the other majors, AUD/USD was lower by 0.06% at 1.0475. NZD/USD jumped 0.1% to 0.8350 despite a disappointing third-quarter reading of New Zealand’s GDP. Statistics New Zealand said that New Zealand’s GDP rose 0.2%, below the 0.4% analysts expected.

The Dollar Index added 0.03% to 79.39.


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