The US dollar dipped against the euro on Friday as investors sought a safe haven despite economic reports that offered signs of a possible US recovery under way.
The euro was at US$1.5703 around 9pm GMT, up from US$1.5683 late on Thursday. The dollar rose to ¥107.85 from ¥107.19.
“Stronger economic data has driven the US dollar higher against many of the major currencies,” said Kathy Lien, chief strategist at Forex Capital Markets.
“New home sales, consumer confidence and durable goods were all better than the market expected, a sign that the mood of US consumers and businesses may be changing,” she said.
However, Lien warned: “Today’s economic releases were almost too good to be true and for that reason, we are cautiously bullish.”
US durable goods orders rose 0.8 percent last month, much stronger than analyst forecasts for 0.3 percent. Economists said the data suggested that US second-quarter GDP growth could prove healthy.
“Overall, a surprisingly strong report, which supports our view that second-quarter GDP increased by a solid 2.5 percent on the year,” said Paul Ashworth, senior US economist at Capital Economics.
The US government is due to release its initial estimate of second-quarter GDP growth on Thursday. Most analysts expect a smaller acceleration to a 1.8 percent pace.
Pummeled by housing and credit crises, the world’s largest economy grew 1 percent in the first quarter after an anemic 0.6 percent pace in the last three months of the year.
The US Federal Reserve said on Wednesday in its Beige Book report that US economic activity appears to have slowed to a crawl in the past weeks even as price pressures intensified.
The Fed’s latest survey of the US economy will be used by its policymakers for their Aug. 5 meeting. They are widely expected to leave the key interest rate unchanged at 2 percent.
In late New York trading, the pound was at US$1.9913, up from US$1.9865 late on Thursday. The dollar stood at 1.0366 Swiss francs, nearly unchanged from SF1.0364.
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