Dollar recedes amid poor US economic data

The dollar fell against most major currencies on Tuesday after US factory orders data came in lower than expected.
The US Census Bureau said factory orders dropped 3.4% in December, undercutting consensus expectations of -2.2%. The figures followed Monday’s disappointing data which said that consumer spending had fallen faster in December than it had since September 2009.

CMC Markets analyst Jasper Lawler said: “The US dollar was mostly lower today on the back of a string of poor US economic data that points to a further growth slowdown into the first quarter of 2015. Rallying commodity prices also meant US dollars were being sold in exchange.”

The EUR/USD grew 0.79% to 1.1433 on Monday while the dollar index, which measures the US currency against a basket of six others, fell 0.67% to $94.18.

Chris Beauchamp from IG added: “EUR/USD’s move back above $1.14 sees it break a level that has held the pair back for a week, a development likely to bring out technical buyers. James Bullard’s observation that the Fed’s overall move on rates should be slow and gradual has boosted the euro as well.”

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