Euro rises to highest since mid-August
Sterling, Swiss franc hit highest since September
U.S. home prices rises in year to September
U.S. consumer confidence rises
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The U.S. dollar sank to a three-month low on Tuesday, as investors continued to take the view that growth in the world's largest economy is starting to slow down after an aggressive tightening cycle since March last year.
That slowdown should prompt the Federal Reserve to begin easing some time next year. U.S. rate futures were pricing in a 23% chance of a rate cut in March, rising to a roughly 50% probability in May, according to the CME's FedWatch tool.
The dollar index =USD , which measures its value against six major currencies, fell as far as 102.89, the lowest since Aug. 31. It was last down 0.1% at 103.02. The index is on track for a loss of more than 3% in November, its worst performance since November 2022.
"For several decades now, the dollar has tended to outperform when the U.S. economy is extremely weak or extremely strong relative to the rest of the world, and has typically fallen during circumstances resembling those now in play - when most major economies are simply muddling through, and growth gaps (between the U.S. and the rest of the world) are narrowing," said Karl Schamotta, chief market strategist at Corpay in Toronto.
"We're seeing outbound dollar flows grow on a consistent basis ahead of year-end as investors rebalance portfolios to take advantage of an expected decline in 2024."
Tuesday's U.S. data, however, continued to trend in a positive direction. U.S.
consumer confidence rose
in November after three straight monthly declines, though households continued to anticipate a recession over the next year, a survey showed.
The Conference Board said its consumer confidence index increased to 102.0 this month from a downwardly revised 99.1 in October.
U.S. annual home price growth accelerated again in September, underscoring a rebound in the housing market as it entered the final quarter of the year.
Home prices were up 6.1%
on a year-over-year basis in September, up from an upwardly revised 5.8% increase in August, the Federal Housing Finance Agency (FHFA) said.
In other currencies, the euro rose to a 3-1/2-month peak of $1.0985 EUR=EBS . It last changed hands at $1.0978, up 0.2%.
Sterling GBP=D3 also gained, climbing to its highest since Sept. 1. The pound was last up 0.3% at $1.2660.
Traders are now eyeing the U.S. core personal consumption expenditures (PCE) price index - the Fed's preferred measure of inflation - this week for more confirmation that inflation is slowing.
PCE tops off a slew of other key economic events this week, including flash inflation data from major euro zone economies, with bloc wide data due Thursday, Chinese purchasing managers' index (PMI) data and an OPEC+ decision on crude output.
The dollar fell 0.2% to 148.33 yen JPY=EBS , with the Japanese currency continuing its recovery from the brink of 152 per dollar earlier in the month.
The dollar also slid 0.2% CHF=EBS to 0.8790 Swiss francs, its lowest level since the start of September, and the Australian dollar AUD=D3 briefly touched a near four-month high of US$0.6633.
The New Zealand dollar NZD=D3 hit its highest since August at US$0.6119. It was last at US$0.6110, up 0.2%. The Reserve Bank of New Zealand has its monetary policy meeting on Wednesday, where it is expected to keep interest rates steady at 5.50% for the fourth straight time.
In cryptocurrencies, bitcoin rose 0.5% to $37,421 BTC=BTSP .
======================================================== Currency bid prices at 10:40AM (1540 GMT)Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Dollar index =USD 102.8300 103.1400 -0.29% -0.638% +103.3200 +102.8400 Euro/Dollar EUR=EBS $1.0990 $1.0954 +0.33% +2.57% +$1.0990 +$1.0935 Dollar/Yen JPY=EBS 147.8800 148.6900 -0.53% +12.81% +148.8200 +147.9000 Euro/Yen EURJPY= 162.54 162.85 -0.19% +15.85% +162.9200 +162.2100 Dollar/Swiss CHF=EBS 0.8779 0.8805 -0.22% -4.99% +0.8818 +0.8779 Sterling/Dollar GBP=D3 $1.2682 $1.2630 +0.41% +4.86% +$1.2682 +$1.2608 Dollar/Canadian CAD=D3 1.3585 1.3617 -0.22% +0.27% +1.3619 +1.3574 Aussie/Dollar AUD=D3 $0.6642 $0.6607 +0.54% -2.56% +$0.6643 +$0.6597 Euro/Swiss EURCHF= 0.9647 0.9641 +0.06% -2.51% +0.9655 +0.9632 Euro/Sterling EURGBP= 0.8663 0.8672 -0.10% -2.05% +0.8683 +0.8665 NZ NZD=D3 $0.6126 $0.6098 +0.46% -3.52% +$0.6126 +$0.6082 Dollar/DollarDollar/Norway NOK=D3 10.6550 10.6440 +0.24% +8.72% +10.7090 +10.6200 Euro/Norway EURNOK= 11.7049 11.6460 +0.51% +11.54% +11.7400 +11.6299 Dollar/Sweden SEK= 10.3761 10.4252 -0.12% -0.30% +10.4439 +10.3690 Euro/Sweden EURSEK= 11.3994 11.4134 -0.12% +2.24% +11.4338 +11.3899 <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates https://tmsnrt.rs/2RBWI5E^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
