Forex- U.S. dollar falls in Asia on faint signs of cliff progress

Published 12/27/2012, 09:38 PM
Updated 12/27/2012, 09:39 PM
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Investing.com- The U.S. dollar was mixed against most of is major rivals in Friday’s Asian session following a mixed batch of U.S. economic data points and lingering fears the policymakers will not be able to solve the fiscal cliff before the fast-approaching January 1, 2013 deadline.

In Asian trading Friday, EUR/USD rose 0.06% to 1.3247. The pair was likely to find support at 1.3172, Wednesday’s low, and resistance at 1.3284, Thursday’s high.

One of the major currencies that the greenback was seen higher against was the yen as USD/JPY jumped 0.31% to 86.39. That gain extends a considerable span of strength for the dollar against the yen and could be a sign that the market is buying into Japanese Prime Minister Shinzo Abe’s yen-weakening rhetoric.

Elsewhere, GBP/USD added 0.06% to 1.6111 while USD/CHF slid 0.09% to 0.9127. USD/CAD gave up 0.05% to 0.9948.

The dollar was under pressure following a disappointing consumer report in the U.S. on Thursday. In U.S. economic news, the Conference Board said its consumer confidence index fell to 65.1 this month from a downwardly revised 71.5 in November. Economists expected a December reading of 70. The U.S. consumer accounts for about 70 percent of GDP in the world’s largest economy

The consumer sentiment reading overshadowed a decent weekly jobless claims report. Initial claims for jobless benefits fell by 12,000 last week to 350,000. The less volatile four-week moving average fell by 11,250 to 356,750. The U.S. unemployment rate is 7.7%.

Although comments from Senate Majority Leader Harry Reid, a Nevada Democrat, lead to steep losses for U.S. stocks and some other risky assets for the bulk of Thursday’s U.S. session, the fiscal cliff fears are weighing on some of the so-called risk on currencies as well.

In Asian trading Friday, AUD/USD is lower by 0.09% at 1.0369 while NZD/USD is off 0.11% at 0.8202. The Dollar Index is higher by 0.03% at 79.74.


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