Dollar Weakens as Commodities Steady
NEW YORK ( TheStreet) -- The dollar was broadly weaker against the majors as stock and commodity markets were steady Tuesday.
The euro was forming a base around $1.40. Eurozone economic data remains supportive of a July rate hike.
U.S. dollar sellers have returned as U.S. equity futures and crude oil rebound, outlining a more constructive market environment. The S&P 500 front future has returned close to the 50-day moving average and crude oil has regained $99 a barrel in a sign that markets are paring back after the sharp losses at the turn of the week. This has allowed the markets to regain $1.41 for the euro and $1.055 for the Aussie with the dollar in broad decline against the majors.
A better-than-expected German IFO helped the market regain a firmer footing as did Spain's strong €3.2 billion sale of three-month and six-month Spanish T-bills.The Norwegian krone has seen some mixed flows after first-quarter GDP came in weaker than expected, but nevertheless NOK has regained ground against the dollar and the earlier dip against the euro has proved short-lived as correlations kick in in-line with the firmer tone in other commodity majors. Some switching out of euro and into sterling is visible this morning, with the market shrugging off a poor result for U.K. April public finances and cable reaching a new high for the day of 1.618, on talk that the Greek New Democracy opposition party has rejected the government's privatization proposals, keeping Greek default risk concerns lingering.
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