The U.S. dollar erased its post-data induced losses against its key counterparts in New York morning deals on Friday, as investors are pricing in a Fed rate hike at its December meeting.
The Commerce Department released a report showing that retail sales rose less than expected in the month of October.
The report said retail sales inched up by 0.1 percent in October, while revised data showed that sales were virtually unchanged in September.
Economists had expected sales to climb by 0.3 percent compared to the 0.1 percent uptick originally reported for the previous month.
Excluding a pullback in auto sales, retail sales rose by 0.2 percent in October following a revised 0.4 percent drop in September. Ex-auto sales were expected to increase by 0.4 percent.
A separate report released by the Labor Department showed an unexpected decrease in producer prices in the month of October.
The Labor Department said its producer price index for final demand fell by 0.4 percent in October after sliding by 0.5 percent in September. Economists had expected the index to rise by 0.2 percent.
Excluding food and energy prices, core producer prices still dropped by 0.3 percent, matching the decrease seen in the previous month. Core prices had been expected to inch up by 0.1 percent.
Although the Fed Chair Janet Yellen did not detail about monetary policy at her Thursday’s speech, some of her colleagues hinted at a rate hike as early at its next month’s FOMC meeting.
St. Louis Fed President James Bullard said it would be prudent to move monetary policy closer to normal levels now that the goals have been attained.
New York Fed President William Dudley also said the risks of moving too quickly or too slowly are nearly balanced but emphasized that a December rate hike will depend on incoming data.
The greenback showed mixed performance in the European session. While the currency fell against the pound, it advanced against the franc and the euro. Against the yen, the greenback held steady.
The greenback erased its post-data led losses immediately against the Swiss franc, with the pair trading higher at 1.0037. On the upside, the greenback may possibly locate resistance around the 1.02 level.
Although the greenback declined to a weekly low of 122.44 against the Japanese yen in the aftermath of the data, it rebounded in a short while. The pair was trading at 122.77, compared to 122.59 hit late New York Thursday. The greenback is seen finding resistance around the 123.5 mark.
The greenback bounced off to 1.5232 against the pound, after having fallen to an 8-day low of 1.5265 a short while ago. If the greenback extends rise, it may challenge resistance near the 1.51 region.
The greenback resumed its advance against the euro, trading at 1.0736. This is 0.75 percent higher from a low of 1.0817 hit at 6:45 pm ET. The next possible resistance for the greenback is seen around the 1.05 area.
The greenback recovered to 0.6518 against the kiwi, 1.3327 against the loonie and 0.7123 against the aussie, off its early lows of 0.6554 and 1.3267, and a weekly low of 0.7159, respectively. Continuation of the greenback’s uptrend may lead it to resistance levels of around 0.64 against the kiwi, 1.35 against the loonie and 0.70 against the aussie.
Looking ahead, U.S. business inventories for September and the University of Michigan’s preliminary U.S. consumer sentiment index for November are set to be announced shortly.
Federal Reserve Bank of Cleveland President Loretta Mester will give a speech about the economy and monetary policy in Cleveland, at 12:30 pm ET.
The material has been provided by InstaForex Company – www.instaforex.com