Products You May Like
Article content
NEW YORK — The dollar fell against major currencies on Friday as U.S. yields
languished and the euro got an extra late-day lift following a earlier boost from an upbeat survey of
purchasing managers.
The dollar index fell 0.5% to 90.8080, a level not seen since early March, after the euro
climbed 0.7% to $1.2098, pushing through its earlier high for the week.
More than half of the euro’s appreciation came late in the day after the market digested earlier
economic news.
“This is thin markets on a Friday afternoon,” said Marc Chandler, chief market strategist at Bannockburn
Global Forex in New York. “The euro making new highs for the week late in the day suggests it is going to
have momentum into next week.”
The exaggerated move came after the markets saw a European purchasing managers’ index for April come in
better than expected, supporting the view that the region’s economic recovery is accelerating and won’t keep
lagging so far behind the U.S. recovery.
A similar U.S. survey showed factory activity powered ahead in April. Another report said new home sales
in the United States jumped 21% in March. Both affirmed that the economy was being lifted by government
stimulus and increased vaccinations against the coronavirus.
Advertisement
Story continues below
This advertisement has not loaded yet, but your article continues below.
Article content
The U.S. survey results were tempered by manufacturers reporting increased struggles to get raw
materials and other supplies for production.
Yields on 10-year U.S. Treasuries traded in a narrow range through the news and were at 1.56% late in
the day, about four basis points lower than at the start of the week.
Until the late-day boost to the euro, Chandler said Friday’s major currency markets were largely “a
continuation of what we have seen since the beginning of the month,” with the dollar losing much that it had
gained earlier in the year as yields climbed to 1.75% on March 31.
“The dollar had a very strong first quarter and the market is still unwinding that,” Chandler said.
The dollar in the first quarter gained 3.6% but it has lost about 2.6% so far in April.
Markets now are looking toward next week’s meeting of the U.S. Federal Reserve Open Market Committee to
review monetary policy and the economy.
Fed Chair Jerome Powell is expected to echo Thursday’s message from European Central Bank President
Christine Lagarde that scaled back some expectations for a withdrawal of monetary easing.
Powell’s remarks could put more downward pressure on Treasury yields and limit any bounce of the dollar.
Auctions of U.S. Treasuries next week are not likely to be big factor, Shaun Osborne, chief currency
strategist at Scotiabank told the Reuters Global Markets forum on Friday.
“There still appears to be good demand for Treasury product,” Osborne said.
Advertisement
Story continues below
This advertisement has not loaded yet, but your article continues below.
Article content
“The FOMC will likely be the highlight of a busy data week for the U.S.,” Osborne said.
Overall, he expects that “low yields, low volatility plus strengthening global growth should drive
diversification away from the USD to riskier assets.”
The Australian and New Zealand dollars firmed on Friday, but traders said risks are
pointed to the downside due to the recent weakening in commodity prices.
The British pound rose 0.3% on the day..
Bitcoin and other cryptocurrencies trimmed some losses that had come out of concern that U.S. President
Joe Biden’s plan to raise capital gains taxes will curb investment in digital assets. Bitcoin, the biggest
and most popular cryptocurrency, slumped as much as 5% and fell below $50,000 for the first time
since early March. It was down 1.5% to $50,932 at 21495 GMT. Smaller rival Ether was down fell
about 2%.
========================================================
Currency bid prices at 3:41PM (1941 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Dollar index 90.8080 91.2870 -0.52% 0.919% +91.2940 +90.8080
Euro/Dollar $1.2098 $1.2016 +0.69% -0.98% +$1.2099 +$1.2013
Dollar/Yen 107.8850 107.9650 -0.07% +4.41% +108.1400 +107.4800
Euro/Yen 130.52 129.72 +0.62% +2.84% +130.5600 +129.6000
Dollar/Swiss 0.9129 0.9169 -0.43% +3.19% +0.9173 +0.9129
Sterling/Dollar $1.3888 $1.3842 +0.33% +1.65% +$1.3895 +$1.3836
Dollar/Canadian 1.2469 1.2503 -0.25% -2.07% +1.2509 +1.2466
Advertisement
Story continues below
This advertisement has not loaded yet, but your article continues below.
Article content
Aussie/Dollar $0.7759 $0.7708 +0.67% +0.86% +$0.7760 +$0.7693
Euro/Swiss 1.1043 1.1015 +0.25% +2.18% +1.1052 +1.1017
Euro/Sterling 0.8710 0.8680 +0.35% -2.54% +0.8718 +0.8673
NZ $0.7202 $0.7166 +0.53% +0.31% +$0.7203 +$0.7151
Dollar/Dollar
Dollar/Norway 8.2840 8.3835 -1.03% -3.38% +8.3625 +8.2970
Euro/Norway 10.0236 10.0507 -0.27% -4.24% +10.0625 +10.0211
Dollar/Sweden 8.3801 8.4263 +0.08% +2.24% +8.4615 +8.3800
Euro/Sweden 10.1394 10.1314 +0.08% +0.63% +10.1551 +10.1155
(Reporting by David Henry in New York and Tommy Wilkes in London; Editing by John Stonestreet, Steve
Orlofsky, Andrew Heavens and David Gregorio)
Advertisement
Story continues below
This advertisement has not loaded yet, but your article continues below.