The US Dollar climbed to session highs against the Pound and pushed beyond a weekly high against a number of peers after data showed that the number of new home sales in the world’s largest economy climbed to the highest level in more than five years, easing concerns that the US economy is slowing and highlighting the strength of the US housing market.
According to the Washington based Commerce Department, new home sales climbed by 9.6% to a seasonally adjusted rate of 468,000 units, beating economist forecasts and was the biggest increase recorded since July 2008.
Despite the harsh winter weather sales in the northeast of the USA soared by 73.7% to a seven-month high whilst the south saw sales rise by 10.4% to reach a new five-year high. Sales rose by 11% in the west but declined by 17.2% in the mid-west.
The US Dollar climbed to its highest level in over a week on Wednesday as speculation grew that Federal Reserve Chairman Janet Yellen will reiterate the Central Bank’s committed to continue to taper its quantitative easing programme.
Also supporting the ‘Greenback’ is speculation that Federal Reserve Chairman Janet Yellen, who is due to address a Senate Panel tomorrow, is expected to say that the Central Bank will continue to taper its monetary easing programme despite a string of weaker than forecast economic data results.
“Any data or any Fed speakers going forward that reiterate the Fed’s tapering is Dollar-positive. Investors are really concerned about how weak economic data may influence the outlook for monetary policies,” said the chief market analyst at Commonwealth Foreign Exchange Inc.
Earlier in the session the Pound found support from a report which showed that the UK economy expanded by 0.7% and business investment increased by 8.5%.
US Dollar (CAD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
US Dollar,
,Pound Sterling,0.6008 ,
US Dollar,,Euro,0.7311 ,
US Dollar,,Australian Dollar,1.1140 ,
US Dollar,,Canadian Dollar,1.1097 ,
[/table]
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