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FOREX-Dollar retreats on recent round of weak U.S. data; sterling, euro gain

Published 06/12/2019, 02:59 am
Updated 06/12/2019, 03:00 am
© Reuters.  FOREX-Dollar retreats on recent round of weak U.S. data; sterling, euro gain
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* Dollar's Trump bump runs out of puff

* Better-than-expected U.S. data on Thursday fails to lift dollar

* Sterling best performer this week

* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh (Adds new comment, FX table, updates prices, changes byline, dateline; previous LONDON)

By Gertrude Chavez-Dreyfuss

NEW YORK, Dec 5 (Reuters) - The dollar fell for a fifth straight session on Thursday, undermined by a recent slew of weaker-than-expected U.S. economic data and this week's robust performance by the euro and the British pound.

The Federal Reserve, at its last monetary policy meeting, said it was on hold after cutting interest rates three times this year. But some analysts suggested that the Fed may have to reconsider that stance if U.S. economic data continues to underwhelm going forward.

"You're looking at concerns that the U.S. economy is yet again slowing down just based on some poor numbers out of both ISM (Institute for Supply Management) numbers," said Joe Trevisani, senior analyst at FXStreet.com.

"I don't think we'll get a weak number though on payrolls on Friday, which is the next big data, but until you get a good number on manufacturing, and here we go again with the U.S.-China trade problem, there's always going to be concern that the U.S. economy is not going to fulfil its potential," he added.

Most currencies traded in tight ranges after turmoil induced by conflicting headlines on the fate of a preliminary U.S.-China trade deal and the lack of clarity on whether any kind of agreement can be reached before Dec. 15, when additional U.S. tariffs kick in on Chinese goods. focus was also on how much damage the trade war is causing and whether the signs of economic stabilisation seen in the euro zone and Chinese data can continue.

German industrial orders fell unexpectedly in October, data showed on Thursday.

U.S. reports on Thursday such as weekly jobless claims and the trade deficit were mostly better than expected, but they are second-tier data that has little bearing on the Fed's monetary policy action.

The trade deficit dropped to its lowest level in nearly 1-1/2 years in October to $47.2 billion, the smallest since May 2018. Initial claims for state unemployment benefits, on the other hand, dropped 10,000 to a seasonally adjusted 203,000 for the week ended Nov. 30, the lowest level since mid-April. data followed Wednesday's dismal figures on private payrolls and services activity, and Monday's poor U.S. manufacturing activity index and construction spending figures manufacturing activity in the euro zone beat expectations.

In late morning trading, the dollar index was down 0.2% at 97.454 .DXY .

The euro EUR= rose 0.2% versus the dollar to $1.1086, while the dollar slipped 0.1% against the yen to 108.78 yen JPY= .

Sterling is this week's best performer, up more than 1.5% this week to the dollar, as it appears likely that the ruling Conservative Party will win a majority in next week's election and end 3-1/2 years of Brexit-related uncertainty by taking Britain out of the European Union.

The British pound traded at a new seven-month high of $1.3146 and extended gains against the euro to a new 2-1/2-year high of 84.31 pence pound was last up 0.3% versus the dollar at $1.3138 GBP=D3 .

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Currency bid prices at 10:38AM (1538 GMT) Description

U.S. Close Pct Change

YTD Pct

High Bid

Low Bid

Previous

Change

Session

Euro/Dollar

$1.1093

$1.1076

+0.15%

-3.28%

+1.1104

+1.1078 Dollar/Yen

108.7400

108.8500

-0.10%

-1.38%

+108.9900 +108.7300 Euro/Yen

EURJPY=

120.64

120.58

+0.05%

-4.42%

+120.8900 +120.5600 Dollar/Swiss

0.9883

0.9884

-0.01%

+0.70%

+0.9895

+0.9874 Sterling/Dollar GBP=

1.3143

1.3103

+0.31%

+3.03%

+1.3158

+1.3104 Dollar/Canadian CAD=

1.3180

1.3199

-0.14%

-3.35%

+1.3203

+1.3158 Australian/Doll AUD=

0.6824

0.6849

-0.37%

-3.22%

+0.6855

+0.6822 ar

Euro/Swiss

EURCHF=

1.0964

1.0951

+0.12%

-2.58%

+1.0982

+1.0942 Euro/Sterling

EURGBP=

0.8438

0.8452

-0.17%

-6.08%

+0.8457

+0.8431 NZ

0.6527

0.6527

+0.00%

-2.83%

+0.6562

+0.6521 Dollar/Dollar

Dollar/Norway

9.1453

9.1726

-0.30%

+5.86%

+9.1772

+9.1405 Euro/Norway

EURNOK=

10.1454

10.1620

-0.16%

+2.42%

+10.1685

+10.1320 Dollar/Sweden

9.4965

9.5113

-0.03%

+5.94%

+9.5250

+9.4911 Euro/Sweden

EURSEK=

10.5336

10.5369

-0.03%

+2.63%

+10.5475

+10.5240

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