Home Fundamental Comment Dollar remains firm after better than forecast US housing data

Dollar remains firm after better than forecast US housing data

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dollarThe U.S. dollar strengthened, adding to its earlier gains, after a report signaling a better than forecast rise in housing starts in April.

Housing starts rose to 1.14 million in April, the highest in seven years, from 1.04 million in March, better than estimates of a rise to 1.06 million.

Building permits also climbed to 1.14 million, compared to both prior and predicted readings of 0.93 million and 1.02 million.

Housing starts rose just 2 percent from February to March as the bad winter weather, noting that U.S. growth eased to 0.2 percent in the first quarter.

Lukewarm jobs, retail sales and consumer sentiment reports released last week raised concerns the weak growth pace would continue in the three months through June.

Investors will focus tomorrow on FOMC minutes for April’s policy meeting to track any signals of the Fed’s rate hike.

Later in the week, the U.S. will release manufacturing and inflation data.

The dollar index, which tracks the greenback’s movement versus a basket of major currencies, set a new high of 95.41 after the housing data, compared to the session’s opening of 94.20.

The six-currency gauge may face some downside pressure as it approaches the 50-center line for the RSI 14 momentum indicator.

The coming resistance ahead is located at 96.00, where it is currently facing resistance near SMA 20 located at 95.40.

Dollar firms after upbeat US housing fxcomment

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Ahmed Mamdouh Ahmed Mamdouh, Co-Founder and Head of English Fundamental Analysis at FXComment.com, with 7 years of experience in the financial markets. Mamdouh holds a Master’s Degree in Economics from The American University in Cairo and a Bachelor Degree in Economics from The Faculty of Economics and Political Science, Cairo University.

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