The dollar is holding onto early gains against the Japanese Yen Tuesday afternoon, but is down against both the Euro and the British pound. There has been no U.S. economic data to drive the direction of trading at the start of this holiday shortened week. Meanwhile, economic data from the Eurozone has been better than anticipated.
U.S. economic data will remain sparse until the end of the week. Investors can look forward to weekly jobless claims data, wholesale trade and import & export prices on Thursday. Readings on producer prices and consumer sentiment are also slated for Friday.
However, the focus of investors is likely to remain on the Federal Reserve policy meeting late next week. The uncertainty that has plagued investors regarding the central bank’s decision on an interest rate hike will likely conclude when the Fed wraps up its 2-day policy meeting on Thursday, September 17.
The dollar hit an early 3-session low of $1.1229 against the Euro Tuesday, before climbing to a high of $1.1151. The U.S. currency is currently trading around $1.1170.
Eurozone economy grew more than initially estimated in the second quarter as strong exports offset the decline in investment. Gross domestic product advanced 0.4 percent sequentially after rising 0.5 percent a quarter ago, Eurostat reported Tuesday. The first quarter growth was the fastest since the same quarter of 2011, when the economy expanded 0.9 percent.
German exports expanded more-than-expected to a record high in July, led by a weak euro, suggesting that it would again be the major growth engine in the third quarter.
Exports rose 2.4 percent month-on-month in July, which was the fastest growth since December 2014. Economists had forecast shipments to grow 1 percent reversing a 1.1 percent fall in June.
Similarly, imports advanced by a faster-than-expected 2.2 percent in July after declining 0.8 percent in June. Imports were expected to grow 0.7 percent.
France’s trade deficit in July widened more-than-expected from the previous month as both exports and imports moderated, figures from the French Customs showed Tuesday. The trade deficit increased to EUR 3.299 billion from EUR 2.757 billion in June, which was the smallest since July 2009. Economists had forecast a shortfall of EUR 3.100 billion. A year ago, the deficit was EUR 5.557 billion.
The buck dropped to a 1-week low of $1.5412 against the pound sterling Tuesday morning, but has since bounced back to around $1.5380.
The greenback climbed to an early high of Y120.226 against the Japanese Yen Tuesday, but has since eased back to around Y119.975.
Japan’s gross domestic product was upwardly revised for the second quarter of 2015, the Cabinet Office said on Tuesday – but the country’s economy still fell into contraction, contracting 0.3 percent on quarter. That’s an upward revision from -0.4 percent in last month’s preliminary reading, and it beat forecasts for -0.5 percent.
Japan posted a current account surplus of 1.808 trillion yen in July, the Ministry of Finance said on Tuesday. That beat forecasts for a surplus of 1.732 trillion yen and it was up from the 55.8 billion yen surplus in June.
A measure of peoples’ assessment of the Japanese economy decreased unexpectedly in August to the lowest level in seven months, survey figures from the Cabinet Office showed Tuesday. The current index of Economy Watchers’ survey fell by 2.3 points to 49.3 in August from 51.6 in the previous month.
The material has been provided by InstaForex Company – www.instaforex.com