The dollar is weakening against both the Euro and the Japanese Yen on Tuesday, but is nearly unchanged against the pound sterling. The U.S. currency is losing ground despite the stronger than expected homebuilder confidence reported today.
Consumer prices in the U.S. rose by a little more than expected in the month of June, according to a report released by the Labor Department on Tuesday, with the price growth largely due to a jump in gasoline prices.
The Labor Department said its consumer price index rose by 0.5 percent in June after inching up by 0.1 percent in May. Economists had been expecting prices to increase by 0.4 percent.
With mining output showing a notable increase, the Federal Reserve released a report on Tuesday showing that industrial production rose by slightly more than expected in the month of June. The Fed said industrial production rose by 0.3 percent in June after coming in unchanged in May. Economists had been expecting production to edge up by 0.2 percent.
Homebuilder confidence in the U.S. has unexpectedly improved in the month of July, according to a report released by the National Association of Home Builders on Tuesday, with the reading on homebuilder confidence reaching its highest level in well over seven years.
The report showed that the NAHB/Wells Fargo Housing Market Index jumped to 57 in July from a downwardly revised 51 in June. Economists had expected the index to come in unchanged compared to the 52 originally reported for the previous month.
The dollar has continued to pull back from yesterday’s high of $1.2992 against the Euro, to around $1.3150 on Tuesday.
Confidence among German investors unexpectedly deteriorated in July as the faltering external demand continued to weaken the country’s exports and industrial production recorded a faster-than expected contraction.
A monthly survey by the ZEW Center For European Economic Research on Tuesday showed that the investor confidence index dropped for the first time in three months, to 36.3 points from 38.5 points in June. Economists had forecast the index, which measures investors’ economic outlook for the next six months, to rise to 40 points.
Eurozone’s trade in goods with the rest of the world resulted in a surplus in May, which was higher than a month earlier, data from Eurostat revealed Tuesday. The trade surplus rose to EUR 15.2 billion in May from a downwardly revised EUR 14.1 billion in April. A year earlier, the surplus amounted to EUR 6.6 billion.
Inflation in euro area accelerated to 1.6 percent in June from 1.4 percent in May, the Eurostat said Tuesday, confirming its flash estimate. Passenger car sales in Europe continued to fall in June and hit the lowest level for the month in seventeen years as economic growth remained sluggish across the euro area, fueling unemployment and weakening households’ purchasing power.
Registrations of new passenger cars fell 5.6 percent annually to about 1.13 million units, which was the lowest June level recorded since 1996, data released by the European Automobile Manufacturers’ Association (ACEA) showed Tuesday. This followed a much worse 6.9 percent fall in May to a twenty-year low for that month.
The greenback is little changed against the pound sterling on Tuesday, hovering around the $1.5125 level, which is down from an early high of $1.5044.
U.K. inflation hit a 14-month high on fuel and clothing costs in June, yet remained below expectations as slower growth in airfares and food prices curbed overall acceleration. Inflation rose to 2.9 percent in June, the fastest since April 2012, from 2.7 percent in May, data from the Office for National Statistics showed Tuesday. But, it stayed marginally below the expected rate of 3 percent.
Output price inflation in the British manufacturing industry accelerated more than forecast to reach a four-month high in June, a report from the Office for National Statistics showed Tuesday. Output price index for goods produced by UK manufacturers rose 2 percent year-on-year in June, faster than a 1.2 percent increase in May. Economists expected the rate of inflation to rise to 1.9 percent.
The buck continues to retreat from yesterday’s high of Y100.473 against the Japanese Yen to around Y99.340 on Tuesday.