The U.S. Dollar gained against the majority of its Forex currency counterparts on speculation that the recent flurry of U.S. economic data will dissuade the Federal Reserve from implementing another round of quantitative easing. According to Commerce Department reports, building permits increased the most since August of 2008 while consumer confidence improved this month, suggesting that consumers may spend more this quarter. In addition, The Conference Board’s index of U.S. leading indicators, which measures the outlook for the upcoming six months, rose more than predicted in July.
The Euro traded at a six-week high versus the Yen after German Chancellor Angela Merkel indicated that Germany is willing to support measures aimed at preserving the shared currency. The Chancellor is scheduled to meet with French President Francois Hollande and Greek Prime Minister Antonis Samaras to discuss the E.U.’s approach to stemming the debt crisis.
Other news in the foreign exchange showed that Australia’s Dollar fell against all but two of its peers following a government statement suggesting that the Reserve Bank is ready to implement monetary easing measures if the currency’s advances hurt the economy. The Aussie remained under pressure as China released less than stellar data revealing a slow-down in its economy.
The British Pound rallied last week on better than forecast retail sales; however, it erased gains against the U.S. Dollar following a hike in U.S. leading indicators.