The dollar is scaling back towards the lows it set on Wednesday, after the Federal Reserve concluded its monetary policy meeting. The U.S. currency bounced back from those sharp declines yesterday, but with a lack of U.S. economic data at the end of the trading week, is again approaching those levels.
Investor optimism for a resolution to the situation in Greece has been the driving force behind Friday’s currency moves. Greek Prime Minister Alexis Tsipras has agreed to submit a list of reforms within days. EU leaders sought more concrete steps on reforms and efforts to overcome the standstill on the aid programme.
Merkel and other key leaders met Tsipras on the sidelines of the two-day EU summit on Thursday night. Tsipras said he is more optimistic after the meeting and talks are back on track. All sides are doing their best to overcome Greece’s troubles, he told reporters. Merkel said no disbursement of fund will be made unless Athens implements budget measures. Merkel is set to meet Tsipras again in Berlin on Monday.
“In the spirit of mutual trust, we are all committed to speed up the work and conclude it as fast as possible,” the EU leaders said in a statement on Friday.
“Within the framework of the Eurogroup agreement of 20 February 2015, the Greek authorities will have the ownership of the reforms and will present a full list of specific reforms in the next days,” it added.
The dollar has pulled back to around $1.0830 against the Euro Friday afternoon, from around $1.06 yesterday. The U.S. currency sank to around $1.10 against the Euro following the Fed statement Wednesday afternoon.
Eurozone current account surplus in January grew from a year ago, as trade surplus and primary income rose sharply, figures from the European Central Bank revealed Friday. The current account surplus rose to EUR 29.4 billion from EUR 18.1 billion a year ago. In December, the surplus was EUR 22.5 billion.
A measure of turning points in the German economy in coming months grew at a slower rate in January, data from the Conference Board showed Friday. The leading economic index for Germany rose 0.4 percent monthly after a 0.8 percent climb in the previous month. In the six months to January, the index added 0.3 points, moving back into positive territory for the first time since June 2014.
Germany’s producer prices dropped more-than-expected in February, figures from Destatis showed Friday. The producer price index fell 2.1 percent year-over-year in February, exceeding economists’ expectations for a 2.0 percent drop.
The buck has also weakened to around $1.4950 against the pound sterling this afternoon, from around $1.4750 yesterday. The dollar sank to around $1.5165 after the Fed statement on Wednesday.
The U.K. budget deficit showed its smallest budget deficit for February since 2008 on robust income tax receipts suggesting that the government is on the course to achieve its budget targets. Public sector net borrowing excluding public sector banks declined by GBP 3.5 billion to GBP 6.9 billion in February, the Office for National Statistics said Friday. It was forecast to fall to GBP 8.4 billion.
The majority of the households in the UK perceived that the value of their houses increased in March, after moderating in the previous month, results of a survey conducted by Knight Frank and Markit Economics showed Friday. The house price sentiment index, or HPSI, rose to 57.5 in March from 56.5 in February. This marked the twenty-fourth consecutive month of the index remaining above 50.
Members of the Bank of Japan’s monetary policy board believe that the country’s economic recovery is continuing at a moderate pace, minutes from the board’s meeting on February 17 and 18 revealed on Friday.
The members added that the quantitative easing in place is having the desired effects, although it cautioned that the rate of inflation has slowed due to falling energy prices.
At the meeting, the central bank kept its monetary policy unchanged, as expected, but lowered its inflation assessment after data showed that the country had exited recession. The bank said that the annual consumer prices index growth was around 0.5 percent. In the previous statement, the bank said that inflation was in the range of 0.5 percent to 1 percent.
The greenback climbed to a 2-day high of Y121.200 against the Japanese Yen Friday, but has since eased back to around Y120.165.
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