The dollar is holding onto slight gains against its major European rivals Tuesday afternoon, but is down against the Japanese Yen. The Yen continues to benefit from its safe haven status, with global equity markets take a beating due to falling oil prices. Meanwhile, U.S. economic data came in weaker than anticipated this morning.
U.S. consumer prices dipped slightly in December amid plunging oil prices and a strong US dollar, fresh government data showed Wednesday. The U.S. Department of Labor reported that its consumer price index, a key gauge of retail inflation, slipped 0.1 percent for December. This came as a surprise to economists, who had expected the measure to remain flat.
The pace of newly started home building projects unexpectedly slowed down in December, according to new government statistics released Wednesday. The U.S. Department of Commerce reported that housing starts fell 2.5 percent for December. This brought the annual rate to 1.149 million units compared to November’s revised pace of 1.179 million. Economists had expected the measure to rise to an rate of 1.2 million.
Building permits, a gauge of future home building, declined as well. The figure retreated 3.9 percent in December to a rate of 1.232 million. Economists had expected a rate of 1.217 million.
The dollar has risen to around $1.09 against the Euro Wednesday afternoon, from an early low of $1.0975.
Eurozone house prices grew for the third consecutive quarter in the three months ended September, though at a slower pace than in the previous quarter, preliminary figures from Eurostat showed Wednesday.
House prices rose 1.0 percent quarter-on-quarter in the third quarter, after a 1.8 percent climb in the previous three-month period.
Germany’s producer prices dropped at a slower pace at the end of the year, Destatis reported Wednesday. Producer prices fell 2.3 percent year-on-year in December, slower than the 2.5 percent decrease seen in November. But it was slightly faster than the expected rise of 2.2 percent.
The buck has inched up to around $1.4150 against the pound sterling this afternoon, from a low of $1.4218.
The U.K. jobless rate fell to its lowest level since early 2006, while the employment rate hit a record high in the three months ended November, and wage growth remained subdued suggesting more time for the Bank of England to decide on a rate hike.
In the three months to November, the ILO unemployment rate was 5.1 percent versus 5.8 percent in the same period the previous year, the Office for National Statistics said Wednesday.
This was the lowest figure since early 2006 and below the expected rate of 5.2 percent.
British household finance index weakened at the start of the year to the lowest level in five months, results of a survey by Markit Economics and financial information provider Ipsos Mori revealed Wednesday. The seasonally adjusted Household Finance Index, of HFI, fell to 43.6 in January from 44.9 in December.
The greenback is attempting to stabilize against the Japanese Yen, at around Y116.675, after pulling back from yesterday’s high of Y118.108.
The material has been provided by InstaForex Company – www.instaforex.com