The dollar is adding to its recent strength against its major competitors Tuesday morning. There was a large number of economic reports released this morning, following yesterday’s Memorial Day holiday. A pair of housing reports exceeded expectations, while durable goods orders were in line with estimates.
Largely reflecting a pullback in orders for transportation equipment, the Commerce Department released a report on Tuesday showing a modest decrease in new orders for U.S. manufactured durable goods in the month of April.
The report said durable goods orders dipped by 0.5 percent in April, with the modest decrease matching economists’ consensus estimate.
Home prices in major U.S. metropolitan areas continued to show notable annual growth in the month of March, according to a report released by Standard & Poor’s on Tuesday.
The report said the 20-City Composite Home Price Index rose 5.0 percent year-over-year in March, unchanged from the annual growth seen in February. Economists had expected the rate of growth to slow to 4.6 percent.
Following the pullback seen in the previous month, the Commerce Department released a report on Tuesday showing that U.S. new home sales rebounded by more than expected in the month of April. The report said new home sales climbed 6.8 percent to an annual rate of 517,000 in April from the revised March rate of 484,000.
Economists had expected new home sales to rise to a rate of 509,000 from the 481,000 originally reported for the previous month.
Consumer confidence in the U.S. improved modestly in May after declining sharply in April, the Conference Board revealed in a report released on Tuesday. The Conference Board said its consumer confidence index rose to 95.4 in May from a downwardly revised 94.3 in April.
Economists had expected the consumer confidence index to dip to 95.0 from the 95.2 originally reported for the previous month.
Investors continue to keep a close on the situation in Greece. The country is expected to make a 300 million euros payment to the International Monetary Fund next week.
Greece’s government on Monday ruled out imposing controls over capital flows over the upcoming long weekend, after an opposition lawmaker suggested the move if the country fails to strike a deal with its creditors soon.
Gabriel Sakellaridis, the spokesman for the Greek government, reportedly said that the speculation of imposing capital controls was “unfounded and malicious.”
There is also political uncertainty now in Spain, where Prime Minister Mariano Rajoy’s Popular Party suffered its worst result in 20 years in a municipal election, as the voters punished his government for four years of austerity and a raft of corruption scandals before a general election due in November.
The dollar has been rising against the Euro for over a week and has set a 1-month high of $1.0875 this afternoon. The U.S. currency was trading around $1.1450 when the upward trend began back on May 18.
The buck bounced off of a 5-month low of $1.5815 against the pound sterling back on May 14 and climbed to 2-week high of $1.5400 on Tuesday.
British retailers posted strong growth in sales this month and their outlook for sales and orders improved at an even stronger pace in the year to June, the quarterly Distributive Trades Survey from the Confederation of British Industry showed Tuesday.
A balance of 51 percent said sales increased in May, up from the prior month’s balance of 12 percent and expectations of 40 percent.
The greenback has broken out to nearly an 8-year high of Y122.955 against the Japanese Yen this afternoon. The dollar has been rising for the past week and a half, after it rebounded from the Y119 level.
Corporate service prices in Japan were up 0.7 percent on year in April, the Bank of Japan said on Tuesday. That beat forecasts for an increase of 0.6 percent following the downwardly revised 3.1 percent gain in March.
The material has been provided by InstaForex Company – www.instaforex.com