Yahoo Finance Dollar Rides Euro Slump to 6-Month High Ahead of Fed Minutes
Investing.com – The dollar remained at six month highs against its rivals on Wednesday following mostly bullish data pointing to underlying strength in the U.S. economy, while a sharp decline in both the pound and euro supported upside momentum.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.46% to 93.94, just shy of its intraday high of 94.04.
The Commerce Department said Wednesday new home sales fell 1.5% to a seasonally adjusted annual rate of 662,000 units last month, missing economists’ forecasts.
A preliminary reading of US manufacturing PMI for May was in-line with expectations at 56.5, while services PMI came in at a reading of 55.7, topping economists’ forecast.
The duo of reports arrived hours ahead of the release of the Federal Reserve’s minutes of its May meeting, when policymakers voted to keep rates unchanged but signalled additional rate hikes would be needed to prevent the economy from overheating.
The dollar’s jump to a six-month high was also supported by slump in both sterling and the euro, offsetting a rise in the yen against the greenback on renewed safe-haven demand.
EUR/USD fell 0.70% to $1.1698, retreating from a session high of $1.1790 as market participants continued to sell into strength amid Italian political uncertainty and eurozone growth concerns.
GBP/USD fell 0.67% to $1.3341 after consumer inflation slowed in April, further denting expectations the Bank of England may raise rates sooner rather than later.
USD/JPY fell 0.68% to Y110.13 as rising US-China trade tensions and the fading prospect of a US-North Korea summit taking place next month renewed demand for safe-haven yen.
USD/CAD rose 0.47% to C$1.2881 after oil prices came under pressure following data showing unexpected build U.S. crude supplies.
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