FOREX-Dollar weakens as Chinese data boosts risk appetite
* Greenback weakens after strong Chinese data
* Aussie dollar outperforms
* Kiwi drops after inflation slows
(New throughout, updates trading and comments to U.S. market
open, new byline, changes dateline, previous LONDON)
By Karen Brettell
NEW YORK, April 17 (Reuters) - The greenback weakened on
Wednesday as better-than-expected economic data in China
bolstered risk appetite and boosted the Australian dollar.
China's economy grew at a steady 6.4 percent pace in the
first quarter, defying expectations for a further slowdown, as
industrial production surged and consumer demand showed signs of
improvement.
“Risk sentiment seems to have improved overnight on the back
of the strong Chinese data,” said Shaun Osborne, chief FX
strategist at Scotiabank in Toronto.
Investors are closely watching Chinese and European economic
data for signals that global growth is recovering.
The release of Purchasing Managers Indexes (PMIs) for the
manufacturing and service sectors in Europe on Thursday will
provide the next indication of the strength of the European
economy.
Investment inflows into Europe have been improving, which
may give the euro a boost against the greenback. The U.S. dollar
is also heading into a period of the year when it has
traditionally weakened.
“We’re at the upper end of the range for the dollar and we
think seasonal pressures should start to weigh a little bit more
on the dollar going forward, generally this is about the time of
year when the dollar starts to soften up from a seasonal point
of view,” said Osborne.
The Australian dollar outperformed on the Chinese data. The
currency is sensitive to the economic fortunes of China,
Australia’s biggest trading partner.
"It is becoming very clear again this morning what really
matters for the Australian dollar is China. The currency is up
despite the fact that the RBA rate meeting caused negative
sentiment yesterday," said Esther Maria Reichelt, an FX
strategist at Commerzbank in Frankfurt.
The New Zealand dollar, meanwhile, fell after data showed
that annual inflation slowed in the first quarter, which raised
the odds of an interest rate cut in the coming months.
Data on Wednesday also showed that the U.S. trade deficit
fell to an eight-month low in February as exports to China
surged, helping to eclipse a rebound in overall imports, which
could boost economic growth estimates for the first quarter.
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Currency bid prices at 9:30AM (1330 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1299 $1.1280 +0.17% -1.48% +1.1324 +1.1280
Dollar/Yen JPY= 111.9800 111.9900 -0.01% +1.56% +112.1600 +111.9300
Euro/Yen EURJPY= 126.50 126.34 +0.13% +0.22% +126.8100 +126.2900
Dollar/Swiss CHF= 1.0089 1.0078 +0.11% +2.80% +1.0092 +1.0068
Sterling/Dollar GBP= 1.3046 1.3048 -0.02% +2.27% +1.3068 +1.3030
Dollar/Canadian CAD= 1.3292 1.3349 -0.43% -2.53% +1.3371 +1.3274
Australian/Doll AUD= 0.7198 0.7175 +0.32% +2.11% +0.7205 +0.7154
ar
Euro/Swiss EURCHF= 1.1401 1.1368 +0.29% +1.31% +1.1412 +1.1366
Euro/Sterling EURGBP= 0.8661 0.8643 +0.21% -3.60% +0.8680 +0.8642
NZ NZD= 0.6735 0.6761 -0.38% +0.27% +0.6775 +0.6672
Dollar/Dollar
Dollar/Norway NOK= 8.4686 8.4911 -0.26% -1.97% +8.4993 +8.4600
Euro/Norway EURNOK= 9.5712 9.5847 -0.14% -3.38% +9.5963 +9.5711
Dollar/Sweden SEK= 9.2324 9.2571 -0.11% +3.00% +9.2660 +9.2167
Euro/Sweden EURSEK= 10.4330 10.4445 -0.11% +1.65% +10.4603 +10.4320
(Additional reporting by Tom Finn in London; Editing by
Bernadette Baum)