Forex - Dollar gains on weak European data, dips against the yen

Shutterstock photo - The dollar rose against most of its peers on Monday after a string of disappointing indicators hit the wire in Europe, dampening demand for risk though the greenback slid against the yen, which rebounded on talk expectations for policy loosening have been priced into the market.

In U.S. trading on Friday, EUR/USD was down 0.26% at 1.3081.

Eurozone retail sales increased 0.1% in November, according to Eurostat, the European Union's statistics office, falling short of market expectations for a 0.3% rise, which pushed the pair downward.

The euro and other risk-on assets also softened after official data revealed that the unemployment rate in the currency bloc hit a record high of 11.8% in November, in line with market expectations and up from 11.7% in October.

Elsewhere in Germany, the government reported that factory orders fell 1.8% in November, outpacing market expectations for a 1.4% decline thanks in part to slumping overseas demand for the country's goods and services.

Disappointing data offset news that the European Stability Mechanism, the currency's zone's permanent bailout fund, sold EUR1.92 billion in short-term debt earlier Tuesday.

Market chatter that credit ratings agencies may downgrade France kept the euro and other currencies in negative territory against the greenback earlier even though Paris dismissed such talk.

Meanwhile in the U.S., the Federal Reserve reported earlier that U.S. consumer credit rose more than expected in November.

In a report, the Federal Reserve said that U.S. consumer credit rose by a seasonally adjusted USD16.05 billion in November compared with a gain of USD14.08 billion in October, whose figure was revised down from USD14.20 billion.

Analysts had expected U.S. consumer credit to rise USD12.75 billion in November.

The greenback, meanwhile, was up against the pound, with GBP/USD trading down 0.38% at 1.6055.

The dollar was slid against the yen, with USD/JPY down 0.68% at 87.19 on sentiment that the yen had weakened enough ahead of widely accepted views that the Bank of Japan will act more aggressively to stimulate the economy.

The dollar, meanwhile, was up against the Swiss franc, with USD/CHF trading up 0.30% at 0.9241.

The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.10% at 0.9870, AUD/USD down 0.04% at 1.0500 and NZD/USD trading down 0.02% at 0.8370.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.12% at 80.45.

On Wednesday, markets will begin digesting fourth-quarter earnings in the U.S. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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