The U.S. Dollar continued to hold close to a 3-week trough versus the common currency Euro following the release of data which suggested that the U.S. economic recovery isn’t as robust as previously thought and likely to lead to the Federal Reserve Bank to continue with its current ultra loose monetary policy.
According to the latest readings from the all-important housing sector and labor situation, pending home sales rose in April to 10.3% from March’s 7.0% but that was against expectations of a hike to 12.9%; claims for both initial and continuing jobless benefits were unexpectedly higher as well.
According to a senior market economist in Tokyo market players’ expectations had been of the Fed beginning to tighten up its bond buying scheme, and with those expectations dashed for the time being the Dollar is likely to be undergoing a period of consolidation.
As reported at 10:17 a.m. (JST) in Tokyo, the EUR/USD pair was trading flat at $1.3045, not far from Thursday’s 3-week peak of $1.3062. The USD/JPY pair was 0.3% higher and trading at 101.02 Yen, getting a boost from expectations that Japanese exporters would be buying the greenback to settle their month-end accounts. The U.S. Dollar Index was trading at 83.051 .DXY and moving away from yesterday’s 2-week trough of 82.955 .DXY.