Dollar Mixed As Investors Focus On Washington

The dollar is turning in a mixed performance against its major rivals Tuesday afternoon. The buck is up against both the Euro and the Japanese Yen, but has reversed and turned lower against the British pound. The pound jumped on unconfirmed reports that the European Union and the UK have reached an agreement on the Brexit Bill.

Investors were focused on Fed chair nominee Jerome Powell’s Senate confirmation hearing in Washington, hoping for indications on his plans to lead the U.S. central bank.

“Our aim is to sustain a strong jobs market with inflation moving gradually up toward our target,” Powell said in prepared testimony. “We expect interest rates to rise somewhat further and the size of our balance sheet to gradually shrink.”

“I will do everything in my power to achieve those goals (maximum employment and price stability) while preserving the Federal Reserve’s independent and nonpartisan status that is so vital to their pursuit,” he added.

Traders are also keeping an eye on the tax bill overhaul in the Senate, where a vote on their version is due on Thursday. The plan should get support from at least 50 members of the Senate GOP caucus to get it passed.

Home price growth in major U.S. metropolitan areas accelerated by more than expected in the month of September, according to a report released by Standard & Poor’s on Tuesday.

The report said the S&P/Case-Shiller 20-City Composite Home Price Index climbed 6.2 percent year-over-year in September compared to the 5.8 percent growth seen in August. Economists had expected the pace of growth to accelerate to 6.1 percent.

In a sign consumers are entering the holiday season in very high spirits, the Conference Board released a report on Tuesday showing an unexpected improvement in U.S. consumer confidence in the month of November.

The Conference Board said its consumer confidence index climbed to 129.5 in November from an upwardly revised 126.2 in October. The increase surprised economists, who had expected the consumer confidence index to drop to 124.5 from the 125.9 originally reported for the previous month.

The dollar has climbed to around $1.1850 against the Euro Tuesday afternoon, after hitting a 2-month low of around $1.1960 yesterday.

Eurozone money supply grew at a slower pace in October, the European Central Bank said Tuesday. The broad monetary aggregate M3 grew 5 percent annually, following September’s revised 5.2 percent increase. The expected rate was 5.1 percent.

German consumer confidence is set to remain unchanged at the end of the year, underpinned by strong economic expectations, while it is yet to be known whether the failed coalition talks would hurt the sentiment, results of the latest survey by GfK showed Tuesday.

The forward-looking consumer confidence indicator showed a reading of 10.7 for December, unchanged from November, the Nuremberg-based market research group said. The score was in line with economists’ expectations.

Germany’s import price inflation eased at a slower-than-expected pace in October, data from Destatis showed Tuesday.

Import prices climbed 2.6 percent year-over-year in October, slower than the 3.0 percent increase in September. Economists had expected the inflation to moderate to 2.5 percent.

Data also showed that export price inflation slowed to 1.5 percent in October from 1.7 percent in the preceding month.

French consumer confidence improved more-than-expected in November, after weakening in the previous four months, survey data from the statistical office Insee showed Tuesday. The consumer sentiment index climbed to 102 in November from 100 in October. Economists had expected the index to increase to 101.

The buck climbed to a high of $1.3219 against the pound sterling Tuesday, but has since sharply reversed, falling to around $1.3375.

The greenback slipped to a low of Y110.919 against the Japanese Yen Tuesday, but has since risen to around Y111.425.

The material has been provided by InstaForex Company – www.instaforex.com