The U.S. dollar moved down on Wednesday, as retail sales were unexpectedly flat in the month of April, supporting the view that the Federal Reserve won’t prefer to raise rates in June meeting.
The report from the Commerce Department showed that retail sales were virtually unchanged in April following an upwardly revised 1.1 percent increase in March. Economists had expected retail sales to edge up by 0.2 percent.
Excluding a modest decrease in auto sales, retail sales inched up by 0.1 percent in April after climbing by 0.7 percent in March. Ex-auto sales had been expected to rise by 0.5 percent.
The data raised concerns over second quarter economic growth, as the Fed prepares to raise rate by this year.
A separate report released by the Labor Department showed an unexpected decrease in U.S. import prices in the month of April.
The report said import prices fell by 0.3 percent in April following a revised 0.2 percent decrease in March. Economists had expected import prices to climb by 0.4 percent.
The Labor Department also said export prices dropped by 0.7 percent in April after inching up by 0.1 percent in the previous month. Export prices had been expected to show another 0.1 percent uptick.
The greenback was lower on Wednesday. It shed 0.51 percent against the euro, 0.53 percent against the pound, 0.18 percent against the yen and 0.53 percent against the franc on the day.
In today’s New York morning session, the greenback depreciated to 0.9216 against the franc, down by 0.79 percent from Tuesday’s closing quote of 0.9289. The next possible support for the greenback-franc pair may be located around the 0.906 mark.
The greenback lost 0.93 percent to hit a 6-day low of 1.1315 against the euro from yesterday’s closing value of 1.1211. On the downside, 1.14 is possibly seen as the next support for the greenback.
Data from Eurostat showed that Eurozone industrial production growth slowed slightly in March, after accelerating in the previous month.
Industrial production rose a working-day-adjusted 1.8 percent year-over-year in March, just below economist’s expectations for a 1.9 percent climb.
Reversing from an early high of 1.5632 against the pound, the greenback eased back with pair trading at 1.5699. The greenback is on course to violate its early 5-month low of 1.5746. The greenback is likely to face support around the 1.576 area.
The greenback hit 119.24 against the yen, a 6-day low, down from 119.85 hit at Tuesday’s close. The greenback is seen finding support around the 118.5 level.
The greenback declined to 1.1928 against the Canadian dollar, a level unseen since January 20. This marks a 0.73 percent depreciation from yesterday’s closing value of 1.2016. Further weakness may lead the greenback to a support around the 1.16 mark.
The greenback slipped to near a 3-month low of 0.8096 against the aussie and a 6-day low of 0.7503 against the kiwi, off early highs of 0.7944 and 0.7316, respectively. Next key support for the greenback may be located around 0.85 against the aussie and 0.755 against the kiwi.
The U.S. business inventories data for March is due shortly.
The material has been provided by InstaForex Company – www.instaforex.com