The euro traded in choppy waters early in New York Monday, after a slight improvement in U.S. retail sales failed to spark an extension of its overnight gains.The retail sales report came on the heels of data that showed an expansion in Japanese economic activity, which set the stage for the euro and other higher-yielding currencies to rise against the low-yielding dollar.But until more convincing data supporting the global economic recovery are released, the euro and its higher-yielding counterparts are likely to remain in their recent ranges, analysts said.
With the morning's U.S. economic reports out of the way, attention will shift to the 12:15 p.m. EST speech of Federal Reserve Chairman Ben Bernanke in New York for clues as to any changes in monetary policy or the state of the U.S. economy.In early New York trading, the euro was at $1.4967 from $1.4920 late Friday, according to EBS via CQG. The dollar was at Y89.44 from Y89.65, while the euro was at Y133.87 from Y133.79. The U.K. pound was at $1.6731 from $1.6690. The dollar was at CHF1.0084 from CHF1.0119.The Dollar Index, which tracks the greenback against a trade-weighted basket of six currencies, was at 74.996 from 75.229.
The U.S. retail sales data were "decent, but not enough to really get excited about and provoke a new leg higher in risk assets," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, N.J.Also limiting the euro's gains was the Monday morning release of the Federal Reserve Bank of New York's Empire Manufacturing Survey, showing its general business conditions index fell by 11 points to 23.51 from 34.57 in October, but remained in positive territory. The index for new orders and shipments also slipped, showing a slower rate of improvement.The euro sputtered last week, failing to make a sustained break over the psychologically key $1.50 mark. This week's full calendar of economic data could give the common currency and other risk-positive assets fodder to rally, as long as the data continue to flow positively, but currency analysts will be looking for the euro to close above $1.5064, its yearly high, to cement its upward trend."We need to close above that to see the rally extend," Dolan said.Also limiting the euro's gains was the Monday morning release of the Federal Reserve Bank of New York's Empire Manufacturing Survey, showing its general business conditions index fell by 11 points to 23.51 from 34.57 in October. The index for new orders and shipments also slipped. However, the figures remained in positive territory, indicating a slower rate of improvement.U.S. retail sales increased 1.4%, above the 0.9% increase projected by Wall Street. But September sales were revised down, to a 2.3% decrease from a previously estimated 1.5% tumble.Aside from automobiles in October, other sales rose just 0.2%. It was the third increase in a row, yet smaller than the 0.4% climb predicted.The U.S. stock market is expected to follow other global bourses and open higher. If stocks rally, the euro and other higher-yielding currencies could track higher, continuing their recent trading patterns.
Overnight, Japan's government said the nation's gross domestic product grew a price-adjusted 1.2% in July-September from the prior quarter, or a 4.8% increase on an annualized basis. The result beat the 0.6% on-quarter growth and 2.2% annualized rise expected by economists polled by Dow Jones Meanwhile, the heads of the 21 Asia-Pacific Economic Cooperation forum governments wrapped up their weekend meeting Sunday--failing to agree on currency movements, a major headache for Asian Asia's export-dependent economies are suffering from the decline of the dollar and of the Chinese currency, which Beijing informally links to the greenback.A draft of the APEC leaders' statement said they would move toward "market-oriented exchange rates," mirroring the phrase that the APEC finance ministers used in their statement Thursday, said a person in the leaders' meeting. But the final communique dropped any reference to currencies."They wanted at least a small reference in the communique, but they were cut off by the Chinese, who didn't want to discuss it," a top adviser to an APEC head of government told Dow Jones Newswires. "This summit was a disappointment."Separately, International Monetary Fund Managing Director Dominique Strauss-Kahn reiterated Monday that the U.S. dollar will remain the most important global currency, even though other currencies--such as the euro, the Japanese yen and perhaps the yuan--may challenge it.The dollar's role won't change much, given that the U.S. will still be the biggest economy, Strauss-Kahn said, speaking at a forum at Tsinghua University in Beijing.
The Canadian dollar was higher Monday morning after the U.S. dollar retreated broadly in currency markets in response to a more favorable attitude towards risk among investors.
The U.S. dollar is at C$1.0446 from C$1.0515 late Friday. It dipped to a low at C$1.0440 in earlier trading before rebounding modestly.Statistics Canada reported Monday morning that manufacturing shipments rose 1.4% in September, slightly below the 1.6% forecast by economists but substantially stronger than the 1.8% decline in the previous month.
A report from TD Securities said it remains bullish on the Canadian currency and expects the currency to benefit from better relative economic fundamentals, rising commodity prices and general disenchantment with the U.S. dollar.
With the morning's U.S. economic reports out of the way, attention will shift to the 12:15 p.m. EST speech of Federal Reserve Chairman Ben Bernanke in New York for clues as to any changes in monetary policy or the state of the U.S. economy.In early New York trading, the euro was at $1.4967 from $1.4920 late Friday, according to EBS via CQG. The dollar was at Y89.44 from Y89.65, while the euro was at Y133.87 from Y133.79. The U.K. pound was at $1.6731 from $1.6690. The dollar was at CHF1.0084 from CHF1.0119.The Dollar Index, which tracks the greenback against a trade-weighted basket of six currencies, was at 74.996 from 75.229.
The U.S. retail sales data were "decent, but not enough to really get excited about and provoke a new leg higher in risk assets," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, N.J.Also limiting the euro's gains was the Monday morning release of the Federal Reserve Bank of New York's Empire Manufacturing Survey, showing its general business conditions index fell by 11 points to 23.51 from 34.57 in October, but remained in positive territory. The index for new orders and shipments also slipped, showing a slower rate of improvement.The euro sputtered last week, failing to make a sustained break over the psychologically key $1.50 mark. This week's full calendar of economic data could give the common currency and other risk-positive assets fodder to rally, as long as the data continue to flow positively, but currency analysts will be looking for the euro to close above $1.5064, its yearly high, to cement its upward trend."We need to close above that to see the rally extend," Dolan said.Also limiting the euro's gains was the Monday morning release of the Federal Reserve Bank of New York's Empire Manufacturing Survey, showing its general business conditions index fell by 11 points to 23.51 from 34.57 in October. The index for new orders and shipments also slipped. However, the figures remained in positive territory, indicating a slower rate of improvement.U.S. retail sales increased 1.4%, above the 0.9% increase projected by Wall Street. But September sales were revised down, to a 2.3% decrease from a previously estimated 1.5% tumble.Aside from automobiles in October, other sales rose just 0.2%. It was the third increase in a row, yet smaller than the 0.4% climb predicted.The U.S. stock market is expected to follow other global bourses and open higher. If stocks rally, the euro and other higher-yielding currencies could track higher, continuing their recent trading patterns.
Overnight, Japan's government said the nation's gross domestic product grew a price-adjusted 1.2% in July-September from the prior quarter, or a 4.8% increase on an annualized basis. The result beat the 0.6% on-quarter growth and 2.2% annualized rise expected by economists polled by Dow Jones Meanwhile, the heads of the 21 Asia-Pacific Economic Cooperation forum governments wrapped up their weekend meeting Sunday--failing to agree on currency movements, a major headache for Asian Asia's export-dependent economies are suffering from the decline of the dollar and of the Chinese currency, which Beijing informally links to the greenback.A draft of the APEC leaders' statement said they would move toward "market-oriented exchange rates," mirroring the phrase that the APEC finance ministers used in their statement Thursday, said a person in the leaders' meeting. But the final communique dropped any reference to currencies."They wanted at least a small reference in the communique, but they were cut off by the Chinese, who didn't want to discuss it," a top adviser to an APEC head of government told Dow Jones Newswires. "This summit was a disappointment."Separately, International Monetary Fund Managing Director Dominique Strauss-Kahn reiterated Monday that the U.S. dollar will remain the most important global currency, even though other currencies--such as the euro, the Japanese yen and perhaps the yuan--may challenge it.The dollar's role won't change much, given that the U.S. will still be the biggest economy, Strauss-Kahn said, speaking at a forum at Tsinghua University in Beijing.
The Canadian dollar was higher Monday morning after the U.S. dollar retreated broadly in currency markets in response to a more favorable attitude towards risk among investors.
The U.S. dollar is at C$1.0446 from C$1.0515 late Friday. It dipped to a low at C$1.0440 in earlier trading before rebounding modestly.Statistics Canada reported Monday morning that manufacturing shipments rose 1.4% in September, slightly below the 1.6% forecast by economists but substantially stronger than the 1.8% decline in the previous month.
A report from TD Securities said it remains bullish on the Canadian currency and expects the currency to benefit from better relative economic fundamentals, rising commodity prices and general disenchantment with the U.S. dollar.
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