The dollar is weakening slightly against all of its major competitors on Tuesday. The U.S. currency is pausing after its recent strong gains against the Japanese Yen and is adding to its recent weakness against the Euro. There has been little news to account for today’s move. Investors will be watching for the release of the minutes from the most recent FOMC meeting Wednesday afternoon.
Wholesale inventories in the U.S. unexpectedly decreased in the month of February, according to a report released by the Commerce Department on Tuesday, although the report also showed a notable rebound by wholesale sales.
The report showed that wholesale inventories dipped by 0.3 percent in February following a downwardly revised 0.8 percent increase in January. The drop came as a surprise to economists, who had expected inventories to rise by 0.5 percent compared to the 1.2 percent jump originally reported for the previous month.
The French economy is expected to grow 0.1 percent in the first quarter, the Bank of France said Tuesday. The estimate is unchanged from the previous forecast.
Italy’s bank lending to private sector decreased for the seventh consecutive month in February despite low interest rates, the Bank of Italy showed Tuesday. Private sector lending was down 1.3 percent month-on-month in February, after easing 1.6 percent in the prior month.
Driven by excessive risk taking and weak corporate governance of state-owned banks, Slovenia faces a “severe” banking crisis, the Organization for Economic Cooperation and Development said Tuesday. The Paris-based OECD called for the main results of new stress tests and urged the government to recapitalize distressed banks.
The corporate sector has a severe debt overhang, which requires an improvement of insolvency procedures, but greater foreign direct investment would also help smooth corporate deleveraging, it observed.
Further, the group of the world’s wealthiest countries said Slovenia requires structural reforms to boost potential growth. But the political economy of reform remains difficult, notably because it has been easy to use a referendum to veto a law.
The dollar has extended its recent weakness against the Euro on Tuesday, falling to $1.3098, its lowest level since March 14th. The U.S. currency has been steadily weakening against the Euro since pulling back from a high of $1.2744 on April 3rd.
Germany’s merchandise exports contracted in February, and at a faster rate than expected by economists, after recording strong growth in the previous month, latest data showed Tuesday.
Exports of goods declined a calendar and seasonally adjusted 1.5 percent month-on-month to EUR90.4 billion in February, after rising 1.3 percent in January, the Federal Statistical Office said. Economists had forecast a more modest decline of 0.3 percent for February.
The value of imports fell at a significantly faster rate of 3.8 percent than the 0.1 percent decline economists had forecast. Compared to February 2012, external purchases recorded a 5.9 percent decline, reversing January’s 2.9 percent growth.
The net trade for the month, on an unadjusted basis, resulted in a surplus of EUR16.8 billion in February, higher than the EUR14.9 billion surplus recorded a year earlier.
France’s merchandise trade shortfall increased in February, contrary to economists’ forecast for a decline, latest data showed Tuesday. The trade deficit increased to EUR6.011 billion in February from EUR5.653 billion in January, the Commerce Ministry said. Economists had forecast the shortfall to improve to EUR5.445 billion. In February 2012, the balance was a deficit of EUR6.506 billion.
The buck reached a high of $1.5238 against the pound sterling on Monday, but has dropped back to around $1.5320 on Tuesday.
U.K. industrial production recovered at a faster-than-expected pace in February, reducing prospects of a triple-dip recession in the first quarter, but the modest improvement in the sluggish economy was countered by a widening trade deficit during the same month.
Industrial output grew 1 percent in February from a month ago, when it was down 1.3 percent, the Office for National Statistics said Tuesday. The rate of growth exceeded a 0.4 percent rise forecast by economists.
The UK’s visible trade deficit increased more than expected in February, the latest figures from the Office for National Statistics showed Tuesday. Trade in goods resulted in a shortfall of GBP 9.4 billion in February, higher than GBP 8.2 billion January. This was expected to increase marginally to GBP 8.6 billion.
Retail sales in the United Kingdom rose in March, the British Retail Consortium reported Tuesday. BRC said overall retail sales were up 3.7 percent from one year ago. Same-store sales increased 1.9 percent from March of 2012.
House sales in the United Kingdom improved in March, the Royal Institute of Chartered Surveyors reported Tuesday. The RICS survey showed residential house price balance rose to minus-1 from the February reading of minus-7.
The greenback climbed to over a 3-year high of Y99.373 against the Japanese Yen on Monday, but has dipped to around Y99.150 on Tuesday.