U.S Dollar Mixed After Housing Starts Data

09:49, 17th October 2014

(RTTNews) - The U.S. dollar traded mixed against its key counterparts on Friday, after the U.S. housing starts showed a notable rebound in month of September.

New residential construction in the U.S. increased by more than anticipated in the month of September, according to a report released by the Commerce Department, although the rebound did not completely offset the sharp drop seen in the previous month.

The Commerce Department said housing starts climbed 6.3 percent to a seasonally adjusted annual rate of 1.017 million in September after tumbling 12.8 percent to a rate of 957,000 in August. Economists had expected housing starts to rise to a rate of 1.008 million.

Building permits, an indicator of future housing demand, also rose 1.5 percent to a rate of 1.018 million in September from the revised August rate of 1.003 million.

The Federal Reserve Chief Janet Yellen expressed concern about the growing inequality in income and wealth in the country, and asked whether this is appropriate with values rooted in America's history.

"The extent of and continuing increase in inequality in the United States greatly concern me," Yellen told at the Conference on Economic Opportunity and Inequality, Federal Reserve Bank of Boston. "The past several decades have seen the most sustained rise in inequality since the 19th century after more than 40 years of narrowing inequality following the Great Depression," she added.

The greenback that fell to 0.9405 against the Swiss franc at 5:00 am ET rose back, trading at 0.9440. The greenback is likely to find resistance around the 0.95 level.

The greenback trimmed its early losses against the euro and was worth 1.2785, up from an early low of 1.2836. The next immediate resistance for the greenback is found around the 1.26 area.

The greenback stabilised against the pound, after having fallen to a 4-day low of 1.6125 at 7:25 am ET. The pair was valued at 1.6085 when it closed yesterday's deals.

The greenback remained firm against the yen, hovering around a 2-day high of 106.61. If the greenback continues its uptrend, it may test resistance around the 108.00 region.

Looking ahead, the Reuters/University of Michigan's preliminary consumer confidence index for October is due shortly.