Housing Numbers Dent Dollar
The greenback was weakening against the euro and the pound Wednesday as new data showed continuing softness in the housing sector.
Euros were selling for $1.3644, up from $1.3604 late Tuesday. British pounds were buying $2.0178, up from $2.0142 a day earlier.
The National Association of Realtors said its index of pending home sales slid 12.2% in July when compared with a month earlier. On a year-over-year basis the drop was even higher, down 16.1%.
"The figures sound dreadful," says Lawrence Krohn, an economist with Standard New York Securities in New York City. "But it means the prospects for
a
Federal Reserve
ease have gone up slightly. The Fed meets again Sept. 18.
Such a move by the Fed would undoubtedly be a negative for the value of the greenback as foreign exchange investors would likely switch their holdings to other currencies with better expected returns.
The exchange-traded funds that track the various currencies were moving in line with action in the spot forex market. The
CurrencyShares British Pound Sterling Trust
(FXB) - Get Report
and the
CurrencyShares Euro Trust
(FXE) - Get Report
were both rising about 0.3% in recent market activity.
In other currencies, the dollar was falling to 115.24 Japanese yen from 116.24 yen previously.
The
CurrencyShares Japanese Yen Trust
(FXY) - Get Report
was falling 0.5%.
Elsewhere, the New Zealand dollar was softer on expectations the country's central bank will lean toward a more accommodative monetary policy. One dollar was buying NZ$1.4518 vs. $1.4391 a day earlier.