Dollar Regains Some Of Its Early Losses

14:19, 31st July 2015

(RTTNews) - The dollar pulled back against its major competitors in early trade Friday, but has since reclaimed some of its lost ground. There were a pair of U.S. economic reports released this morning, but the results proved mixed.

After two months of contraction, MNI Indicators released a report on Friday showing that Chicago-area business activity expanded far more than expected in July.

MNI Indicators said its Chicago Business Barometer jumped to 54.7 in July from 49.4 in June, with a reading above 50 indicating growth in regional business activity. Economists had expected the index to show a more modest increase to 50.5.

Consumer sentiment in the U.S. pulled back by more than previously estimated in the month of July, according to a report released by the University of Michigan on Friday. The report said the consumer sentiment index for July was downwardly revised to 93.1 from the mid-month reading of 93.3. With the downward revision, the index was even further below the final June reading of 96.1

The downward revision came as surprise to economists, who had expected the index to be upwardly revised to 94.1.

The dollar dropped to nearly a 1-week low of $1.1113 against the Euro Friday morning, but has since rebounded to around $1.10.

Eurozone inflation remained stable at 0.2 percent in July, flash data from Eurostat showed Friday. Inflation has stayed in positive territory for the third straight month and July's rate matched economists' expectations.

The euro area unemployment rate remained unchanged in June at the lowest level seen since early 2012, Eurostat reported Friday. The jobless rate held steady at 11.1 percent in June, unchanged from May. This was the lowest rate recorded in the euro area since March 2012. The rate was forecast to drop to 11 percent.

Germany's retail sales declined unexpectedly in June after rising in the previous two months, preliminary figures from Destatis showed Friday.

Retail sales fell a calendar and seasonally adjusted 2.3 percent month-on-month in June, in contrast to a 0.4 percent rise in May. Economists had expected a 0.3 percent increase for the month. It was the first fall in three months.

French consumer spending increased for the third straight month in June at the fastest pace in five months, largely led by robust food consumption, the statistical office Insee reported Friday. Consumer spending rose 0.4 percent month-on-month in June, while economists had expected a 0.5 percent increase. In May, spending has risen 0.1 percent, the same rate of growth in April.

France's producer prices continued to decline in June, figures from the statistical office Insee showed Friday. Producer prices in the domestic market fell 1.9 percent year-over-year in June. Prices in the total industry dropped 1.4 percent, while foreign market prices rose by 0.2 percent.

The buck fell to a 2-day low of $1.5677 against the pound sterling this morning, but has since bounced back to around $1.5630.

Consumer confidence in the United Kingdom stalled in June, the latest survey from polling firm GfK revealed on Friday with an index score of +4. That missed forecasts for +5 and was down from +7 in June.

The greenback slipped to a 2-day low of Y123.516 against the Japanese Yen Friday, but has since climbed back to around Y123.875.

The unemployment rate in Japan came in at a seasonally adjusted 3.4 percent in June, the Ministry of Internal Affairs and Communications said on Friday. That was above forecasts for 3.3 percent, which would have been unchanged from the May reading.

The average of household spending in Japan was down 2.0 percent on year in June, the Ministry of Internal Affairs and Communications said on Friday - standing at 268,652 yen. That was well shy of forecasts for an increase of 1.9 percent following the 4.8 percent spike in May.

Consumer prices in Japan gained 0.4 percent on year in June, the Ministry of Internal Affairs and Communications said on Friday. That beat expectations for an increase of 0.3 percent, although it slowed from 0.5 percent in May.

Japan's housing starts growth accelerated sharply and construction orders rebounded in June, data from the Ministry of Land, Infrastructure, Transport and Tourism showed Friday. Housing starts logged a double-digit growth of 16.3 percent in June, after increasing 5.8 percent in May. The annual growth was forecast to slow to 3 percent.