The dollar retreated on Friday after reaching its highest level in two-and-a-half months against the Swiss franc and a one-month high against the euro, as investors took profits ahead of the weekend and month end.
The US currency came under pressure after investors failed to push the euro below strong technical support at US$1.2350. The euro bounced off US$1.2375 and rebounded over a cent in volatile trading to end the New York session right around where it began the month.
In late New York trading, the euro was quoted at US$1.2495, up from US$1.2439 late on Thursday. The dollar was quoted at 109.16 yen, down from 109.63 yen. The dollar was quoted at 1.2618 Swiss francs, down from 1.2677, and 1.3370 Canadian dollars, down from 1.3416. The British pound rose to US$1.8671 from US$1.8608.
The choppy trading conditions come amid growing uncertainty about whether the European Central Bank will act to counter euro strength. Speculation that the central bank may cut interest rates at its monetary policy meeting next Thursday -- or even intervene -- has been behind much of the dollar's rise over the past week.
Hopes of a rate cut were fueled by euro-zone data on Friday showing a bigger-than-expected drop in inflation.
The initial estimate for the euro-zone's annual inflation rate in February fell to 1.6 percent, its lowest level since November, 1999. Final data for January showed a decline of 0.2 percent on the month, giving an annual rate of 1.9 percent, in line with expectations.
Meanwhile, German Chancellor Gerhard Schroeder said he told US President George W. Bush that the euro's level is "worrying" during their meeting on Friday at the White House.
But unlike earlier in the week, when Schroeder's suggestion that the ECB should consider using monetary policy to counter euro strength helped boost the dollar, the market largely shrugged off his most recent comments.
Most analysts don't expect the ECB to cut rates at the upcoming meeting, though they will be paying close attention to the subsequent press conference by ECB President Jean-Claude Trichet for signs of any shift in bias.
Until the market gets the result of that meeting and the US February payroll numbers next Friday, volatile market conditions will probably continue, say market participants.
"There's a lot of uncertainty about the way the price action has evolved this week and people are wary about where the Federal Reserve and the ECB are going," said Daniel Katzive, currency strategist at UBS in Stamford, Connecticut.
"But ultimately, I think this is a correction, and once positions are cleared out, the dollar can resume its downtrend," he said.
Data out of the US Friday resulted in some wide market swings, but generally presented a mixed picture of the US economy.
Fourth-quarter gross domestic product was revised up to an annual rate of 4.1 percent growth from 4 percent.
BYPASSING CHINA TARIFFS: In the first five months of this year, Foxconn sent US$4.4bn of iPhones to the US from India, compared with US$3.7bn in the whole of last year Nearly all the iPhones exported by Foxconn Technology Group (富士康科技集團) from India went to the US between March and last month, customs data showed, far above last year’s average of 50 percent and a clear sign of Apple Inc’s efforts to bypass high US tariffs imposed on China. The numbers, being reported by Reuters for the first time, show that Apple has realigned its India exports to almost exclusively serve the US market, when previously the devices were more widely distributed to nations including the Netherlands and the Czech Republic. During March to last month, Foxconn, known as Hon Hai Precision Industry
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and the University of Tokyo (UTokyo) yesterday announced the launch of the TSMC-UTokyo Lab to promote advanced semiconductor research, education and talent development. The lab is TSMC’s first laboratory collaboration with a university outside Taiwan, the company said in a statement. The lab would leverage “the extensive knowledge, experience, and creativity” of both institutions, the company said. It is located in the Asano Section of UTokyo’s Hongo, Tokyo, campus and would be managed by UTokyo faculty, guided by directors from UTokyo and TSMC, the company said. TSMC began working with UTokyo in 2019, resulting in 21 research projects,
Taiwan’s property market is entering a freeze, with mortgage activity across the nation’s six largest cities plummeting in the first quarter, H&B Realty Co (住商不動產) said yesterday, citing mounting pressure on housing demand amid tighter lending rules and regulatory curbs. Mortgage applications in Taipei, New Taipei City, Taoyuan, Taichung, Tainan and Kaohsiung totaled 28,078 from January to March, a sharp 36.3 percent decline from 44,082 in the same period last year, the nation’s largest real-estate brokerage by franchise said, citing data from the Joint Credit Information Center (JCIC, 聯徵中心). “The simultaneous decline across all six cities reflects just how drastically the market
Ashton Hall’s morning routine involves dunking his head in iced Saratoga Spring Water. For the company that sells the bottled water — Hall’s brand of choice for drinking, brushing his teeth and submerging himself — that is fantastic news. “We’re so thankful to this incredible fitness influencer called Ashton Hall,” Saratoga owner Primo Brands Corp’s CEO Robbert Rietbroek said on an earnings call after Hall’s morning routine video went viral. “He really helped put our brand on the map.” Primo Brands, which was not affiliated with Hall when he made his video, is among the increasing number of companies benefiting from influencer
RSS