The dollar is up slightly against its major competitors Tuesday, recovering a bit from the weakness of the previous session. Yesterday’s weaker than expected U.S. manufacturing data has investors thinking that the Federal Reserve will not rein in its bond-buying program anytime soon. Investors will be watching for the release of the U.S. jobs report for May at the end of the week.
While a jump in the value of imports contributed to a notably wider U.S. trade deficit in the month of April, the deficit still came in narrower than economists had expected. A report released by the Commerce Department on Tuesday showed that the trade deficit widened to $40.3 billion in April from a revised $37.1 billion in March.
Economists had been expecting the trade deficit to widen to $41.2 billion from the $38.8 billion originally reported for the previous month.
The dollar has bounced back from yesterday’s 3-week low of $1.3107 against the Euro to around $1.3075 on Tuesday.
Producer prices in the euro area declined in April, contrary to economists forecast for a modest increase, latest data showed Tuesday. The producer price index decreased 0.2 percent on an annual basis in April, defying expectations for a 0.2 percent increase. In March, prices increased by 0.6 percent, which was revised down from 0.7 percent.
Spain’s registered unemployment logged the biggest decline for the month of May signaling that the economy is finally set to recover from a deep-recession, data from the labor ministry revealed Tuesday. The number of unemployed plunged by 98,265 in May or 1.97 percent from the previous month. This was the second consecutive decrease in unemployment, which left the registered unemployed at 4.89 million in May.
The greenback has also rebounded from Monday’s low of $1.5375 against the pound sterling, to around $1.5310 on Tuesday.
Retail sales in the UK increased more than expected in May as shops managed to lure consumers despite “topsy-turvy temperatures” and continued economic woes, a survey by the British Retail Consortium (BRC) and KPMG showed Tuesday.
Sales value rose 1.8 percent on a like-for-like basis in May from a year earlier. This followed a 2.2 percent fall in April and was faster than a 1.3 percent increase expected.
The British construction sector unexpectedly returned to growth in May after shrinking for six months in a row, helped by strong residential building activity, in yet another sign that the recovery started in the beginning of the year is gaining traction.
Survey data released by Markit Economics and the Chartered Institute of Purchasing and Logistics (CIPS) Tuesday showed that the seasonally adjusted purchasing managers’ index for the construction sector rose to a seven-month high of 50.8 in May from 49.4 in April. Economists’ forecast was for a more modest increase to 49.8.
The buck fell to a 3-week low of Y98.852 against the Japanese Yen on Monday, but has climbed back to around Y100.100 on Tuesday.
The monetary base in Japan spiked 31.6 percent on year in May, the Bank of Japan said on Tuesday, standing at 154.141 trillion yen. That followed the 23.1 percent annual increase in April.
Japan’s wages rose at the fastest pace in more than a year in April, the latest figures from the Labor Ministry showed Tuesday. Total labor cash earnings increased 0.3 percent year-on-year in April to JPY 273,427. This was the first increase in wages in three months and the fastest gain in 13 months.
In March, total earnings were down 0.9 percent from a year earlier. Wages were boosted partly by an improvement in total hours worked, data showed.