The U.S. dollar showed mixed performance against its key counterparts in the European session on Tuesday, after a data showed that the nation’s retail sales pulled back much more than anticipated in the month of February.
Data from the Commerce Department showed that retail sales plunged by 3.0 percent in February after soaring by an upwardly revised 7.6 percent in January.
Economists had expected retail sales to dip by 0.5 percent compared to the 5.3 percent spike originally reported for the previous month.
Excluding a steep drop in auto sales, retail sales still tumbled by 2.7 percent in February after surging up by 8.3 percent in January. Ex-auto sales were expected to edge down by 0.1 percent.
Data from the Labor Department showed a jump in U.S. import prices in the month of February.
The report showed import prices increased by 1.3 percent in February after surging up by 1.4 percent in January. Economists had expected import prices to climb by 1.2 percent.
The Labor Department said export prices also shot up by 1.6 percent in February following a 2.5 percent spike in January. Export prices were expected to increase by 0.9 percent.
Investors focus on the Fed meeting beginning today for clues about the future outlook for the economy.
The Fed is widely expected to leave interest rates unchanged, but traders will be paying close attention to any changes in the accompanying statement.
Investors will closely watch the Fed’s reaction to the recent spike in bond yields, which has led to considerable volatility in Wall Street in recent sessions.
The currency showed mixed trading against its major opponents in the Asian session. While it rose against the pound and the yen, it was steady against the franc. Versus the euro, it fell.
The greenback pulled back to 108.94 against the yen, from a high of 109.29 seen at 3:50 am ET. The pair had closed Monday’s deals at 109.12. The greenback is likely to challenge support around the 106.00 region, if it drops again.
Data from the Ministry of Economy, Trade and Industry showed that Japan industrial production rose more than estimated in January.
Industrial Production increased a seasonally adjusted 4.3 percent month-on-month in January. In the initial estimate, output rose 4.2 percent.
The greenback eased off to 1.3883 against the pound, after rising to a 1-week high of 1.3809 at 5:15 am ET. The greenback is seen finding support around the 1.41 mark.
The greenback held steady against the franc, after having dropped to a 4-day low of 0.9243 at 6:35 am ET. At yesterday’s trading close, the pair was quoted at 0.9274.
The U.S. currency rebounded to 1.1915 against the euro, following a drop to 1.1952 at 7:45 am ET. The pair was worth 1.1924 when it closed deals on Monday. Next immediate resistance for the currency is eyed around the 1.16 level.
Survey data from the ZEW – Leibniz Centre for European Economic Research showed that German economic confidence improved in March.
The ZEW Indicator of Economic Sentiment rose 5.4 points to 76.6 points in March. The reading was above economists’ forecast of 74.0.
Looking ahead, U.S. business inventories data for January and NAHB housing market index for March are scheduled for release in the New York session.
The material has been provided by InstaForex Company – www.instaforex.com