The dollar gained the most against the euro in four days and
strengthened versus the yen
as global stocks rallied and the index of
leading U.S. economic indicators unexpectedly rose in April. The
greenback had traded earlier near the lowest level in more than two
weeks against the common European currency on concern that a decline in
consumer confidence may prevent a rebound in U.S. economic growth. The
dollar advanced after the Conference Board's gauge increased 0.1
percent for a second month, better than forecast, the New York-based
research group said today. The measure points to the direction of the
economy over the next three to six months.
The dollar may gain further on speculation minutes from the Fed's
meeting last month will show policy makers are concerned that rising
commodity prices will fan inflation. The Fed on May 21 will release
minutes of its April meeting, where the policy- setting Federal Open
Market Committee cut the benchmark interest rate by a quarter point to
2 percent.
EU Construction production decreased on
the month in March on weak demand in both building and civil
engineering, more than offsetting February's upwardly revised gain,
Eurostat said Monday. March's 2.2% monthly decrease left output down
1.4% on the year. Taking into account an upward revision for February
to +1.6% from +1.2% and a minor downward
correction of
January data, production in 1Q stood 2.3% above 4Q output, which was
revised up 0.4 point by Eurostat to -0.1% q/q. Looking ahead, tighter
lending terms and a widespread cooling of housing markets are likely to
weigh on construction as well as overall investment.
EUR/USD: gained from $1.5560/80 to $1.5632 to be lower tlater till $1.5480/$1.5520 after strong US data.
GBP/USD: fell from a high at $1.9620 to daily lows on $1.9450.
USD/JPY: sunk from Y104.30 to Y103.60, before rebounding till Y104.70/30.
PPI data at 1230GMT leads the US releases and is expected to rise
0.4%in April on an increase in energy prices and a smaller, but still
solid,rise in food prices. Core PPI is forecast to rise 0.2%. The
weekly Redbook data is then due at 1255GMT.