Dollar Attempting A Comeback From Early Weakness
The dollar dropped against its major European competitors Monday morning, but has begun to pare those losses this afternoon. Markets in Europe are closed today for the Easter holiday and U.S. economic data was largely positive this morning. However, PCE data was a bit of a disappointment.
Personal income in the U.S. increased by slightly more than expected in the month of February, according to a report released by the Commerce Department on Monday. The report said personal income rose by 0.2 percent in February after climbing by 0.5 percent in January. Economists had expected income to tick up by 0.1 percent.
The Commerce Department also said personal spending inched up by 0.1 percent in February, matching the downwardly revised uptick seen in January. The slight increase in spending matched economist estimates, although spending in January was downwardly revised from the originally reported 0.5 percent growth.
Partly reflecting strong growth in the Midwest, the National Association of Realtors released a report on Monday showing a bigger than expected increase in U.S. pending home sales in the month of February. NAR said its pending home sales index climbed 3.5 percent to 109.1 in February from a downwardly revised 105.4 in January. Economists had expected the index to increase by about 1.5 percent.
Data from the Commerce Department showed that price index for PCE decreased 0.1 percent in February following a 0.1 percent increase in January. The reading was in line with expectations.
Core PCE prices rose just 0.1 percent in February after rising 0.3 percent a month earlier. Economists had forecast an increase of 0.2 percent.
Traders are awaiting a speech by Federal Reserve Chair Janet Yellen at an Economic Club of New York event on Tuesday. Yellen's remarks could offer some clues about the central bank's plans for further rate hikes this year.
The dollar dropped to a 3-session low of $1.1219 against the Euro this morning, but has since bounced back to around $1.12.
The buck fell to a 4-session low of $1.4282 against the pound sterling Monday, but has since rebounded to around $1.4245.
The greenback slipped to a low of Y113.138 against the Japanese Yen this morning, but has since risen to around Y113.350.
The material has been provided by InstaForex Company - www.instaforex.com