Posted February 02, 2011
US Dollar down to three month low after euro zone data. UK pound hits high note.
During the Tuesday trading session, the US dollar feel to the lowest level it has been at since November. This came after mostly strong data out of Europe was released, which helped to move currency investors to trim back on their safe haven investments that have recently put in place due to the turmoil in Egypt.
The US dollar pared losses during the day after a report indicated that US manufacturing data was stronger than what most experts had predicted for the report. However, there was equal pressure coming in from European economic data reports. Those showed a variety of countries or regions in the euro zone as well as worldwide that had promising interest. This has pushed the US dollar lower as many currency investors try to cash in on these more lucrative investments.
The US dollar index showed that the US dollar moved from 77.777 as of the close of business in North American trading on Monday to 76.008 by the close of business during the Tuesday currency trading session. During the trading session, it did fall as low as 76.969, which is the lowest the currency has been at in the last three months.
The euro moved from US $1.3689 at the end of the trading session on Monday in North American trading to US $1.385 by the end of the Tuesday close. During the trading day, the currency was able to climb as high as US $1.3836 before losing some ground. This is the highest level the euro has been at since November.
A variety of factors contributed to the increase here. One of those was a report about German unemployment numbers. The report, which was seasonally adjusted, showed that there was a decline in unemployment by 13,000 in the month of January. That was a drop that was larger than what most economists predicted.
Also notable during the trading session was that the US dollar also fell against the UK pound (as well as the Australian dollar.) The strong factory data out of the UK prompted the UK pound to increase.
Against the Japanese Yen, the US dollar fell during the Tuesday session as well. It moved from Y 82.07 at the end of the Monday trading session in North America to Y 81.40 by the end of the Tuesday trading session. The yen tends to be the most sensitive to interest rate changes in the marketplace.