Improved economic data from the U.S. helped to push the greenback to a 1-week peak versus the Japanese Yen while it maintained its position against the common currency Euro. That, in turn, helped to give an edge up to the U.S. Dollar Index, which measures the strength of the greenback against the weighted basket of major rivals including both the Euro and the Yen. Analysts say that given the absence of strong fundamentals recently, FX traders were anxious for any data which could even suggest an improved U.S. economy and the news that home resales in the U.S. rose last month alongside a supply-side increase to a 2-year year suggested that the housing market was on the road to recovery.
As reported at 10:53 a.m. (JST) in Tokyo, the U.S. Dollar Index was trading at 80.228 .DXY, a gain of 0.2%. The USD/JPY held at 101.79 Yen, less than a handful of pips form the overnight peak of 101.82 Yen but moving firmly away from Wednesday’s los of 100.80 Yen. The EUR/USD edged lower by 0.2% to $1.3654, close to this week’s trough of $1.3634.
Euro Area PMI Could be Rate Determinant
This week’s Eurozone PMI releases showed that the pace of what had been perceived as strong growth seems to be slowing slightly with France’s reading dropping once again below the 50.0 threshold; France is the Eurozone’s second largest economy after Germany and a key to the overall health of the Eurozone. That news could tip the balance in favor of Euro bears who see more easing on the ECB’s horizon as a result of continued deflation in the area.