Daily Afternoon Report 23/11/2015
The dollar remained higher against the other major currencies today, despite the release of disappointing U.S. housing sector data, as expectations for a December rate hike by the Federal Reserve continued to support the greenback. The U.S. National Association of Realtors said that existing home sales decreased by 3.4% to 5.36 million units last month from 5.55 million in September. Analysts had expected existing home sales to fall 2.3% to 5.40 million units in October.
But demand for the dollar continued to be underpinned by expectations that the Fed is on track to raise interest rates next month.
New York Fed President William Dudley said Friday that there is a “strong case” for hiking rates at the central bank’s next meeting in December as long as economic data continues to remain solid.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.19% at seven-month highs of 99.83.
Elsewhere, the euro found some support after research group Markit said that its euro zone composite purchasing managers’ index, which measures the combined output of both the manufacturing and service sectors, rose from 53.9 in October to 54.4 in November. It was the index’s highest level in more than four years. Markit also said the German manufacturing PMI ticked up to 52.6 this month from 52.1 in October, while the services PMI rose to 55.6 in November from 54.5 in October.
In France, Markit’s manufacturing PMI ticked up to 50.8 in November from 50.6 the previous month, in line with expectations, while the services PMI fell to 51.3 from 52.7.