FX:Dollar broadly lower as market sentiment improves
Forexpros - The U.S. dollar was broadly lower against its major counterparts on Monday, as concerns over the outlook for the global economy abated after robust manufacturing data from Europe and China spurred demand for riskier assets.
During European morning trade, the dollar was fractionally lower against the euro, with EUR/USD inching up 0.05% to hit 1.3346.
The euro’s gains were limited after official data showed that unemployment rate in the region ticked up to a record high of 10.8% in February from 10.7% the previous month, broadly in line with expectations.
On Friday, euro zone finance ministers agreed to strengthen the bloc’s debt firewall, but concerns remained over whether the measures would be enough to prevent contagion to Spain and Italy.
The greenback was trading close to a four-and-a-half month low against the pound, with GBP/USD adding 0.23% to hit 1.6044.
The pound’s gains came after a report showing that U.K. manufacturing activity expanded at the fastest rate in 10 months in March.
The U.K. manufacturing purchasing managers' index rose to 52.1 last month from an upwardly revised 51.5 in February, confounding analysts' expectations for a drop to 50.5.
The greenback was lower against the yen but inched higher against the Swiss franc, with USD/JPY slipping 0.19% to hit 82.70 and USD/CHF edging up 0.03% to hit 0.9026.
The yen weakened earlier after an index of sentiment at Japanese manufacturers declined more-than-expected in the first quarter, fanning concerns that the Bank of Japan may implement fresh easing measures.
In Switzerland, a report showed that manufacturing activity improved more-than-expected in March, expanding for the first time in seven months.
A separate report showed that Swiss retail sales rose less-than-expected in February.
Elsewhere, the greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.04% to hit 0.9978, AUD/USD climbing 0.35% to hit 1.0385 and NZD/USD rising 0.14% to hit 0.8194.
The Australian dollar found support after data over the weekend showed that manufacturing activity in China jumped to an 11-month high in March, easing concerns over a slowdown in the world’s second largest economy. China is Australia’s largest export destination.
In Australia, official data showed earlier that building approvals fell unexpectedly in February, declining 7.8% after a 1.1% rise the previous month.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, slid 0.07% to hit 79.06.
Later Monday, the Institute of Supply Management was to release a report on U.S. manufacturing activity.
