The dollar is rising against its major competitors for a third consecutive session on Tuesday. The currency is continuing its efforts to rebound from the weakness it endured for the majority of the prior trading week, due to fears that the Federal Reserve would act soon to taper its stimulus measures.
Retail sales in the U.S. rose for the fourth consecutive month in July, according to a report released by the Commerce Department on Tuesday, although the sales growth was slightly weaker than expected due to a notable drop in auto sales.
The report said retail sales edged up by 0.2 percent in July following an upwardly revised 0.6 percent increase in June. Economists had expected sales to rise by 0.3 percent compared to the 0.4 percent increase originally reported for the previous month.
After reporting decreases in U.S. import prices in each of the four previous months, the Labor Department released a report on Tuesday showing a modest increase in import prices in the month of July.
The report said import prices rose by 0.2 percent in July following a revised 0.4 percent decrease in June. However, the price growth fell well short of economist estimates for a 0.9 percent increase.
The Labor Department also said export prices edged down by 0.1 percent in July, matching the drop seen in June. Economists had expected export prices to rise by 0.2 percent.
Business inventories in the U.S. were virtually unchanged in the month of June, according to a report released by the Commerce Department on Tuesday. The report said business inventories came in unchanged in June after edging down by 0.1 percent in May. Economists had been expecting inventories to increase by about 0.2 percent.
The dollar has risen to over a 1-week high of $1.3232 against the Euro on Tuesday, from the month and a half low of $1.3400 set on August 7th.
Industrial production in the euro area increased in June, after falling in the previous month, data released by statistical office Eurostat showed Tuesday. Industrial production increased a seasonally adjusted 0.7 percent month-on-month in June, reversing the previous month’s 0.2 percent decrease, which was revised up from a 0.3 percent fall. Economists had forecast production to record a faster growth of 1 percent.
Germany’s economic sentiment surged to a five-month high in August as slowing recession in many European countries, along with robust domestic demand, boosted investor optimism, a survey the Center for European Economic Research, or ZEW, revealed Tuesday. The ZEW indicator of economic sentiment rose to 42, the highest since March, from 36.3 in July. The outcome was better than the expected score of 39.9.
Germany’s EU harmonized inflation stayed unchanged in July from the previous month, in line with the preliminary estimates, final latest data released by the Federal Statistical Office showed Tuesday. Inflation, as per the harmonized index of consumer prices (HICP), was 1.9 percent in July, unchanged both from the flash estimates and the inflation rate recorded in June.
German wholesale prices showed no change in July from a year earlier, the latest data from the Federal Statistical Office showed Tuesday. This followed a 0.7 percent increase in June and a 0.1 percent fall in May. On a monthly basis, the price index fell 0.3 percent in July after a 0.4 percent drop in June.
The greenback is holding around the $1.5460 level against the pound sterling, an improvement from the low of $1.5574 it set on August 7th.
U.K. inflation slowed from a 14-month high in July as the price discounting on clothing and footwear sales partially offset the gains in fuel and transport costs, data released by the Office for National Statistics showed Tuesday.
Nonetheless, factory-gate prices accelerated on higher petroleum prices, and input price inflation hit the highest since March 2012, signaling existence of inflationary pressure in the economy.
Consumer price inflation dropped marginally to 2.8 percent, in line with forecast, from 2.9 percent in June. On a monthly basis, consumer prices remained flat after falling 0.2 percent in June.
UK home prices increased at the fastest pace in almost seven years in July as government measures to stimulate the housing market attracted more buyers, a survey by the Royal Institute of Chartered Surveyors (RICS) showed Tuesday. The RICS house price balance rose to 36 in July, the highest reading since November 2006, from 21 in June. Economists expected the reading to rise to 24.
House price inflation in the United Kingdom surged to its highest level in six months in June, a report from the Office for National Statistics showed Tuesday.
House prices increased 3.1 percent year-on-year in June, the fastest pace since December 2012. This followed a 2.9 percent increase in May. The June outcome, however, was weaker than the expected 3.5 percent increase.
The Japanese government will likely press ahead with the first consumption tax hike in April 2014, but will also take steps to mitigate its potential risks to the economic recovery, Capital Economics economists Julian Jessop and Marcel Thieliant said.
In order to limit the risks to growth, the government is likely to provide some fiscal stimulus that partially offsets the impact of the tax hike, make the second tax hike conditional on a rapid recovery from the first, or phase the doubling of the consumption tax over a longer period, the firm noted.
The buck has climbed to a 1-week high of Y98.253 against the Japanese Yen, after rebounding from the low of Y95.797 set on August 7th.
Core machine orders in Japan contracted a seasonally adjusted 2.7 percent on month in June to 777.4 billion yen, the Cabinet Office said on Tuesday, falling for the second time in three months. The headline figure was significantly better than forecasts for a 7.0 percent plunge following the 10.5 percent spike in May.
