Tuesday April 17, 2007 - 10:47:34 GMT
Share This Story
INVESTICA Ltd - www.investica.co.uk
Housing data key for dollar
High inflation data will tend to support the US currency, but the effect will be limited unless there is also evidence of a recovery in the housing data
Despite some stabilisation around 1.3550, the dollar struggled to make any significant headway against the Euro on Monday. The dollar was holding little changed in early Europe on Tuesday with a marginally stronger US currency as there was caution ahead of the key US data later in the day.
US retail sales rose 0.7% in March while there was a 0.8% underlying increase for the month. These figures were close to expectations, although the February data was revised up with an underlying increase of 0.4% from -0.1% previously and there was a recovery in building-related sales. Markets will pay close attention to the latest housing figures on Tuesday and only a strong set of data would alleviate underlying negative sentiment towards the economy.
The US consumer inflation data will also be important on Tuesday as the markets continue to assess US inflation trends. A firm consumer inflation figure would make it more difficult for the Federal Reserve to cut interest rates and would provide some dollar support. The US currency will not, however, secure strong support if there is a combination of high inflation and weak growth as there would be further concerns over the risk of stagflation in the economy.
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."