The dollar was generally weaker on Friday, as traders turned attention to Europe amid a lack of first-tier economic news from the United States.
Reports surfaced this morning indicating that Spain is planning to bail out its beleaguered regional savings banks, which have struggled since the nation’s housing bubble burst in 2009.
The dollar dropped to a fresh 2-month low of $1.3567 versus the euro, extending its steep losses from earlier in the week. Earlier in January, the buck touched a 4-month high of $1.2873.
Talk of inflation in the Euro zone and successful bond auctions for Spain and Portugal have raised speculation that the European Central Bank will boost interest rates sooner than expected.
German business confidence hit a new high in January, boosted by an increasingly optimistic manufacturing and construction sectors.
The business climate index, which measures firms’ sentiment, rose to 110.3 in January from a revised 109.8 in December, a monthly survey conducted by the Ifo institute among 7,000 executives showed Friday.
The buck weakened a bit versus the yen, slipping to Y82.70. Back in November, the dollar hit a 15-year low of Y80.22 and has since failed to sustain any movement away from that mark.
The dollar was stable versus the sterling, holding at $1.5950 compare to a 2-month low of $1.6059 set earlier in the week.
Commodity prices steadied after seeing pulling back sharply on Thursday. The dollar eased a hair below parity versus Canada’s resource-backed loonie.
While there is little economic news expected from the US today, corporate earnings results may give a sense of conditions in the private sector.
It is hoped that the pace of hirings will pick up if corporations continue to post string quarterly profits.
First-time claims for unemployment benefits fell by much more than anticipated in the week ended January 15th, according to a report released by the Labor Department on Thursday, with jobless claims pulling back near the two-year low set in late December.
The report showed that initial jobless claims fell to 404,000 from the previous week’s revised figure of 441,000. Economists had been expecting jobless claims to slip to 420,000.