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Forex - Dollar lower against rivals after U.S. home sales data

Published 08/23/2011, 11:18 AM
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Investing.com – The U.S. dollar remained lower against all of its major rivals on Tuesday, following the release of worse-than-expected U.S. housing data while the euro slipped after remarks by former Federal Reserve Chairman Alan Greenspan.

During U.S. morning trade, the greenback trimmed losses against the euro, with EUR/USD up 0.24% to hit 1.4393.

The euro weakened after Mr. Greenspan said the single currency was “breaking down," adding that resulting difficulties in the European banking system could pose a threat to U.S. economic growth.

The greenback was also lower against the pound, with GBP/USD rising 0.31% to hit 1.6504.

Earlier Tuesday, data showed that U.K. factory orders unexpectedly rose this month, while a separate report showed that mortgage approvals hit a one-year high in July.

In addition, the greenback was lower against the yen and the Swiss franc, with USD/JPY sliding 0.35% to hit 76.51 and USD/CHF slipping 0.15% to hit 0.7890.

Earlier in the day, Japan’s Finance Minister Yoshihito Noda reiterated his “strong resolve” to protect Japan’s largely export driven economy by selling the yen.

Meanwhile, the greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.08% to hit 0.9896, AUD/USD advancing 0.75% to hit 1.0487 and NZD/USD jumping 1.17% to hit 0.8393.

Data released earlier showed that a preliminary reading of China’s August purchasing managers’ index edged up to 49.8 in August from a final reading of 49.3 the previous month.

A number below 50 indicates contraction in the sector, but the report lifted market sentiment, following speculation that the reading could have been much weaker.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, fell 0.63% to hit 73.76.

Also Tuesday, official data showed that new home sales in the U.S. fell more-than-expected in June.

The Census Bureau said that new home sales fell to a seasonally adjusted annual rate of 298K, from 312K in the preceding month. Analysts had expected new home sales to fall to 310K last month.

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