Dollar Higher in Asian Hours - 12.12.2011
US Dollar
Asian stocks rose moderately, following Friday’s gains of the major European and US indices, as some investors were encouraged by the results of the European Union summit and by favorable macroeconomic data from the United States. The US economy is showing signs of recovery – the University of Michigan preliminary index of consumer sentiment climbed in December to a six-month high – 67.7 (from 64.1). That means that consumer confidence increased more than economists initially estimated (65.8), leaving more space for economic growth.
Euro
The euro however touched on Friday its one-week low against the dollar (1.3288) and remains under pressure in Asian trading hours today after the European Central Bank cut its benchmark interest rate to 1% and as European leaders failed to recover investors confidence. Despite ECB President Mario Draghi said that the EU summit had a “very good outcome” and German Chancellor Angela Merkel said the accord set the region on a path to a “lastingly stable euro”, analysts are still concerned about its success. The leaders agreed to take steps toward a more strict common fiscal control system and consider a 200 billion-euro anti-crisis package, which would be distributed through the IMF.
The single currency fell from 1.3376 to 1.3330 in Asian trading hours today as investors are waiting for the results of Italian and French bonds auctions. According to Bloomberg, Italy is scheduled to sell 7 billion euros of 365-day bills today, while France is expected to offer 6.5 billion euros of short-term debt.
Australian Dollar
The Australian dollar depreciated slightly against the greenback today after a report showed the nation’s trade surplus narrowed more than economists estimated. The Australian Bureau of Statistics reported the seasonally adjusted figure decreased in October to 1595 million Australian dollars from 2249 million in September due to rising imports and declining exports. The Aussie fell from 1.0207 to 1.0160.