The dollar is down against all of its major competitors Friday afternoon, but is paring its losses as the week draws to a close. U.S. economic data was largely weaker than expected this morning, with the exception of the Chicago PMI report.
Personal income and spending in the U.S. both saw modest increases in the month of September, a report from the Commerce Department revealed on Friday, although the upticks came in below economist estimates.
The report said personal income inched up by 0.1 percent in September after climbing by an upwardly revised 0.4 percent in August. Economists had expected income to rise by 0.2 percent compared to the 0.3 percent increase originally reported for the previous month.
The Commerce Department said personal spending also crept up by 0.1 percent in September after rising by an unrevised 0.4 percent in the previous month. Spending had also been expected to climb by 0.2 percent.
Indicating a promising start to the fourth quarter, MNI Indicators released a report on Friday showing an unexpected expansion in Chicago-area business activity in the month of October. MNI Indicators said its Chicago Business Barometer jumped to 56.2 in October from 48.7 in September, with a reading above 50 indicating growth.
Economists had expected the index to show a much more modest increase to a reading of 49.2, which would have still indicated a contraction.
Consumer sentiment in the U.S. improved by less than previously estimated in October, according to a report released by the University of Michigan on Friday. The report said the final reading on the consumer sentiment index for October came in at 90.0 compared to the preliminary reading of 92.1.
The index remains above the final September reading of 87.2, although economists had expected the index to be upwardly revised to 92.5.
The dollar fell to a low of $1.1072 against the Euro Friday, but has bounced back to around $1.1010.
Eurozone consumer prices stagnated in October, while the jobless rate unexpectedly fell to its lowest level in about two-and-a-half years in September, preliminary figures from Eurostat revealed Friday. The consumer price index remained unchanged from the same month a year ago, after declining 0.1 percent in September. The outcome was in line with economists’ expectations.
Separately, Eurostat announced that the unemployment rate for the euro area fell to 10.8 percent in September from a revised 10.9 percent in August. Economists had expected the rate to remain unchanged at August’s original figure of 11 percent. It was the lowest rate recorded in the euro area since January 2012, the agency said.
Germany’s retail sales remained unchanged in September, defying economists’ expectations for an increase, figures from Destatis showed Friday. The calendar and seasonally adjusted retail sales, in real terms, showed no variations in September, following a 0.7 percent decrease in August. Economists had expected a 0.4 percent increase for the month.
French producer prices declined further in September, largely due to a sharp decrease in prices of coke and refined petroleum products, the statistical office INSEE showed Friday. Producer prices in the French market fell 2.6 percent year-over-year in September, which was worse than the 2.1 percent decrease in August.
French consumer spending remained unchanged in September after rising in the previous months, figures from the statistical office INSEE showed Friday. Consumer spending in volume showed no variations in September after a 0.1 percent slight rise in August, which was revised from a flat reading.
The buck dropped to a 1-week low of $1.5467 against the pound sterling this afternoon, but has since rebounded to around $1.5440.
Consumer confidence in the United Kingdom slid to a four-month low in October, the latest survey from GfK showed on Friday with an index score of +2. That was shy of expectations for +4 and down from +3 in September.
Close on heels of unchanged decisions by central banks of two developed nations earlier this week, the Bank of Japan also kept its massive stimulus unchanged, as expected by economists.
The post-meeting policy statement released Friday showed that the Monetary Policy Board of the BoJ governed by Haruhiko Kuroda decided by an 8-1 majority vote to maintain its target of raising the monetary base at an annual pace of about JPY 80 trillion. The bank also maintained its asset purchase program unchanged.
The Bank of Japan on Friday said inflation is likely to take more time to reach its 2 percent target and the economy is set to shift to a growth path thereafter.
In its semi-annual outlook report, the central bank said inflation excluding fresh food prices is projected to be around 2 percent target in the second half of fiscal 2016. Earlier, the bank forecast inflation to be around target by the middle of next year.
The bank lowered the core inflation projection for fiscal 2016 to 1.4 percent from 1.9 percent.
The greenback hit an early low of Y120.217 against the Japanese Yen Friday, but is now trading around Y120.675.
Inflation in Japan was flat on year in September, the Ministry of Internal Affairs and Communications said on Friday. That matched expectations while slowing from 0.2 percent in August.
The unemployment rate in Japan came in at a seasonally adjusted 3.4 percent in September, the Ministry of Internal Affairs and Communications said on Friday – unchanged and in line with expectations. The job-to-applicant ratio was 1.24, also matching forecasts and up from 1.23 in August.
The average of household spending in Japan was down 0.4 percent on year in September, the Ministry of Internal Affairs and Communications said on Friday, coming in at 274,309 yen. That missed forecasts for an increase of 1.2 percent following the 2.9 percent jump in August.
Japan’s housing starts growth slowed more-than-expected in September, data from the Ministry of Land, Infrastructure, Transport and Tourism showed Friday. Annual growth in housing starts eased notably to 2.6 percent in September from 8.8 percent climb in the previous month.
Economists had expected a 5.8 percent gain for the month. However, it was the seventh consecutive monthly rise.
The material has been provided by InstaForex Company – www.instaforex.com