The dollar is turning in a mixed performance against its major competitors at the start of the new trading week. The U.S. currency is slightly higher against the Euro, but is down in comparison to the pound sterling and the Japanese Yen.
Economic data was relatively light today. Activity in the U.S. service sector expanded at a modestly faster rate in the month of June, according to a report released by the Institute for Supply Management on Monday, although the index of activity in the sector rose by slightly less than expected.
The ISM said its non-manufacturing index inched up to 56.0 in June from 55.7 in May, with a reading above 50 indicating growth in the service sector. Economists had expected the index to rise to 56.4.
Greece continues to dominate the headlines after the Greek people voted to reject the austerity measures proposed by the country’s international creditors.
The overwhelming “no” vote on the referendum has added to recent concerns about Greece defaulting and exiting from the eurozone. EU leaders are now awaiting proposals from Greece Prime Minister Alexis Tsipras.
The ECB’s policymaking governing council will hold a conference call today to consider whether to continue providing emergency funding for Greek banks. Eurozone nations will hold an emergency summit on Tuesday to discuss the Greek referendum result.
While Greece and its international creditors are expected to try to restart negotiations on a new bailout agreement, the ECB’s response would be crucial in determining the extent of contagion.
The dollar jumped to an early high of $1.0992 against the Euro Monday, but has since retreated to around $1.1060.
Eurozone investor confidence improved from a four-month low despite Greece crisis, survey data from the think tank Sentix showed Monday. The investor confidence index rose unexpectedly to 18.5 in July from 17.1 in June. It was forecast to fall to 16.
Germany’s factory orders decreased for the first time in three months in May reflecting the weakness in domestic market.
Factory orders fell 0.2 percent month-on-month in May, in contrast to a 2.2 percent increase in April, which was revised up from a 1.4 percent growth, Destatis reported Monday. This was the first decline in three months. But it was slower than the expected decrease of 0.4 percent.
Germany’s construction sector activity grew at the weakest pace in five months in June as new orders declined, survey data from Markit Economics showed Monday. The seasonally adjusted Purchasing Managers’ Index, or PMI, for the construction sector, declined to 50.7 in June from 50.8 in the previous month.
The buck also set an early high of $1.5531 against the pound sterling, but has since dropped to around $1.56.
The greenback sank 4-session low of Y122.177 against the Japanese Yen early Monday, but has since bounced back to around Y122.370.
The leading index for Japan, which measures the future economic activity, decreased as expected in May after rising in the previous two months, figures from the Cabinet Office showed Monday. The leading index fell to 106.2 in May from 106.4 in April. The latest figure came in line with economists’ expectations. In March, the reading was 105.2.