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Dollar broadly lower as U.S. open eyed

Published 10/31/2012, 09:10 AM
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Investing.com - The U.S. dollar was broadly lower against the other major currencies on Wednesday, as market sentiment firmed up ahead of the reopening of U.S. markets, following a two-day closure for Hurricane Sandy.

During European afternoon trade, the dollar was lower against the euro, with EUR/USD up 0.32% to 1.2998.

Sentiment on the single currency was boosted after Spanish Prime Minister Mariano Rajoy said earlier that his country needs the help of the European Union to meet its budget goals, and added that EU progress on a banking union would allow leeway on making a formal request for aid.

Elsewhere, official data showed that the unemployment rate in the euro zone climbed to a record 11.6% in September, from an upwardly revised 11.5% in August, adding to concerns over the deepening impact of the region’s debt crisis.

Earlier Wednesday, official data showed that German retail sales rose 1.5% in September, the fastest pace since June 2011, easily beating expectations for a 0.3% increase.

The greenback was also lower against the pound, with GBP/USD rising 0.24% to 1.6111.

Sentiment on sterling remained underpinned after stronger-than-expected retail sales data from the Confederation of British Industry on Tuesday dampened expectations for more easing by the Bank of England and fuelled hopes for a sustained economic recovery.

Elsewhere, the greenback was higher against the yen, with USD/JPY up 0.27% to 79.84, but slid lower against the Swiss franc, with USD/CHF down 0.35% to 0.9290.

The greenback was mixed against its Canadian, Australian and New Zealand counterparts, with USD/CAD up 0.17% to 1.0010, AUD/USD easing up 0.10% to 1.0374 and NZD/USD gaining 0.15% to trade at 0.8219.

The Canadian dollar erased gains after official data showed that the Canadian economy contracted by 0.1% in August, compared to expectations for growth of 0.2%.

Year-over-year, the economy expanded by 1.2% in August, disappointing expectations for growth of 1.7%.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.18% to 79.86.

Later Wednesday, the U.S. was to produce official data on manufacturing activity in Chicago, as well as a government report on crude oil inventories.


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