US Dollar Mixed as Euro Holds on to Gains

  May 16th, 2012 at 13:25, Miranda Marquit

Some US one-dollar billsUS dollar is mixed today as gains against the pound and the yen are offset to some degree by the way the euro is managing to eke out gains in spite of the turmoil over Greece. However, even with this small setback against the euro, the US dollar is still likely to remain strong overall, since safe haven currencies are likely to be in demand for some time.

For now, the US dollar is turning in a mixed performance today. Against the UK pound, greenback is higher as the Bank of England lowers its growth forecast for the year to +0.8%, revised down from +1.2%. The news has some speculating that more asset buying could ensue in an effort to stimulate the British economy, and that is weakening the pound. Against the yen, the greenback is a little higher thanks to the news that housing starts improved 2.6% in April in the United States, and on the upwardly revised numbers from March.

Euro has struggled higher on this same improved data out of the United States. A little bit of risk appetite is being seen as investors are diverted from the Greek drama that continues. Worries about Greeks withdrawing money from banks, the possibility that bailout funds will not be received, and that Greece may leave the eurozone are taking a surprising second seat to better news out of the United States. But this is unlikely to last long, since Forex traders are interested in the safety offered by the US dollar.

At 13:23 GMT EUR/USD is up to 1.2743 from the open at 1.2730. GBP/USD is down to 1.5951 from the open at 1.5993. USD/JPY is up to 80.4330 from the open at 80.1850.

If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.

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