The U.S. dollar declined against its key counterparts in early European trading on Friday, as investors reduced holdings of safe-haven assets on hopes that the killing of pro-EU MP Jo Cox may increase support for the U.K. staying in the European Union at the referendum next week.
Britain’s politicians suspended the Brexit referendum campaign, following the death of Labour MP Jo Cox, a strong advocate for voting to stay in next week’s referendum. Events planned by the U.K. Independence Party, Economists for Brexit and Labour Leave also remain canceled.
Further underpinning sentiment was higher oil prices on the back of a weak dollar.
Investors await the release of U.S. building permits and housing starts data later in the day, after yesterday’s economic reports on inflation, jobless claims, homebuilder confidence and regional manufacturing offered a mixed picture on the economy.
The greenback showed mixed trading against its key counterparts in Asian deals. While the greenback declined against the euro and the pound, it rose against the yen. Against the franc, it held steady.
The greenback slipped to 1.4310 against the pound, its weakest since June 13, and held steady thereafter. At Thursday’s close, the pair was valued at 1.4203. The greenback is seen finding support around the 1.44 zone.
Survey figures from Markit Economics and Knight Frank showed that British households perceived that the value of their home increased in June, though at a slower rate than in the previous month.
The Knight Frank/Markit House Price Sentiment Index, or HPSI, dropped to 59.7 in June from 61.0 in the previous month.
The greenback reversed from an early high of 104.83 against the Japanese yen, edging down to 104.09. On the downside, the greenback may challenge support around the 102.00 area.
The greenback fell back to 1.1264 against the euro, from a high of 1.1223 hit at 3:10 am ET. If the greenback slides further, 1.14 is likely seen as its next support level.
Figures from the European Central Bank showed that the euro area current account surplus increased notably in April largely on higher primary income.
The current account surplus totaled a seasonally adjusted EUR 36.2 billion in April compared to EUR 26.3 billion in the prior month.
The greenback that ended Thursday’s trading at 0.9649 against the Swiss franc dropped to 0.9619.The next possible support for the greenback may be found around the 0.95 region.
Looking ahead, at 7:45 am ET, European Central Bank board member Benoit Coeure is expected to speak at the International Conference on Structural Reforms in Advanced Economies, organized by Hertie School of Governance in Berlin.
In the New York session, Canada CPI and PPI data and U.S. building permits and housing starts, all for May, are slated for release.
At 11:00 am ET, European Central Bank President Mario Draghi is scheduled to deliver a speech in honor of Dr Theodor Waigel at conferral of signs and awards in Munich.
At 12:50 pm ET, Bank of Canada Senior Deputy Governor Carolyn Wilkins is expected to speak at the Canadian Payments Association in Calgary.
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