The dollar is slightly weaker against its major European rivals on Tuesday, but is up slightly in comparison to the Japanese Yen. Overall, the U.S. currency is little changed on the day. For the second day in a row there were no U.S. economic reports to drive trading, keeping some investors on the sidelines. However, there are several important reports due to be released in the next few days.
Existing home sales are scheduled to be released on Wednesday, while new home sales are slated for Thursday. Weekly jobless claims are also due Thursday and durable goods orders will be released at the end of the week.
Investors continue to monitor the situation in Greece. The European Central Bank is exploring measures to reduce the Emergency Liquidity Assistance to Greek banks, reports said Tuesday, citing people with knowledge of the discussions.
ECB Staff have suggested an increase in the haircuts banks take on the collateral they offer for emergency funding from the Bank of Greece, both Bloomberg and CNBC said.
The haircut implies the reduction made in the value of collateral assets while allotting a loan. The ratio is not made public. An increase in the haircut will reduce the amount of emergency funding that banks will receive in return for the security they offer as collateral.
The Greek government ordered the country’s public sector undertakings to hand over any cash they have in reserve to the central bank, reports said Monday. These funds, if sufficient, are intended to be used to meet a payment of nearly EUR 1 billion to the International Monetary Fund in May.
Investors will be watching for further developments at the end of the week, at the meeting of the Eurozone finance ministers in Riga, Latvia.
The dollar rose to a 3-day high of $1.0659 against the Euro early Tuesday, but has since retreated to around $1.0750.
German investor confidence deteriorated for the first time since October as global weakness and Greece crisis weighed on domestic prospects, survey data from the Centre for European Economic Research, or ZEW, showed Tuesday. The indicator of economic sentiment dropped unexpectedly by 1.5 points to 53.3 in April. Economists had forecast the index to improve to 55.3.
The Eurozone government deficit ratio declined in 2014, while government debt increased from last year, Eurostat reported Tuesday. The government deficit to GDP ratio fell to 2.4 percent in 2014 from 2.9 percent in 2013. Meanwhile, the government debt to GDP ratio increased to 91.9 percent from 90.9 percent a year ago.
The buck set a 3-day high of $1.4855 against the pound sterling Tuesday morning, but has since pulled back to around $1.4945.
The greenback has been trading in a range between Y119.830 and Y119.200 against the Japanese Yen Tuesday. The U.S. currency is currently trading at Y119.620.
The leading index for Japan, which measures the future economic activity was revised down in February, final figures from Cabinet Office showed Tuesday. The leading index fell to 104.8 in February, revised from the preliminary estimate of 105.3. In January, the score was revised to 105.0.
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