💎 Fed’s first rate cut since 2020 set to trigger market. Find undervalued gems with Fair ValueSee Undervalued Stocks

FOREX-Dlr eases vs yen in thin trade; US data eyed

Published 12/24/2008, 06:29 AM
Updated 12/24/2008, 06:35 AM
UBSN
-

(All UK financial markets are closed on Thursday and Friday for the Christmas and Boxing Day holidays. The markets will reopen on Monday, Dec. 29. FX coverage from London will end around midday on Wednesday, and resume on Dec. 29. Coverage from Asia will continue as normal throughout the period, and coverage from the United States will resume on Friday.)

* Dollar eases vs yen, currency basket

* Euro steady, Trichet offers little hint on ECB policy

* Sterling on defensive after poor housing survey

* Focus on U.S. spending, durable goods data

(Adds quotes, updates prices)

By Tamawa Desai

LONDON, Dec 24 (Reuters) - The dollar fell against the yen and a basket of currencies on Wednesday as investors anticipated more grim U.S. economic data, although losses were limited as market players wound up positions early in thin holiday trade.

In quiet trade ahead of the Christmas holidays, traders awaited readings on U.S. spending, durable goods and jobless claims, following figures on Tuesday that confirmed a U.S. economic contraction and dismal readings on housing.

"The failure of housing figures to hold up will inhibit economic recovery in the United States and spillover effects, such as reduced spending on goods and services due to declining home wealth, will be felt in the coming months," said Geoffrey Yu, strategist at UBS in London.

By 1103 GMT, the dollar was down 0.4 percent on the day at 90.45 yen. It fell 0.3 percent against a basket of currencies at 81.151.

The euro was little changed at around $1.40, after European Central Bank President Jean-Claude Trichet said late on Tuesday that the central bank will do what is necessary to maintain price stability but refrained from commenting directly on the policy outlook

ECB Governing Council members Ewald Nowotny told Austrian television on Wednesday that further interest rate cuts cannot be ruled out, but the central bank did not want to be seen as pre-committing on possible rate cuts.

Meanwhile, sterling was on the defensive again after a survey showed UK house prices would fall by 10 percent next year.

That came after data on Tuesday showed the UK economy shrank by a larger-than-expected 0.6 percent in the third quarter.

Sterling was down 0.4 percent at $1.4704 and down 0.7 percent at 95.10 pence against the euro, edging near a record low of 95.56 pence.

U.S. data later in the day is expected to show personal income was flat and spending fell 0.7 percent in November.

On the corporate side, durable goods orders are seen dropping 3.0 percent versus a 6.9 percent decline in October.

Meanwhile, weekly jobless claims data is expected to show 560,000 new filings for jobless benefits in the week ended Dec. 20, compared with 554,000 in the prior week. (Editing by Toby Chopra)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.