Dollar Ends Week on Quiet Note After U.S. Data Fails to Ignite

Frankfurt (May 17)  The dollar had a quiet end to the week, remaining virtually unchanged against the other major currencies following the release somewhat mixed economic data at home. This mornings data got off to a bad start when the University of Michigan said that its consumer sentiment index fell to 81.8 in May, from a reading of 84.1 the previous month, compared to expectations for a rise to 84.5.

But the news was offset by a rise in building permits. With U.S. building permits climbing 8% to 1.080 million units last month, from an upwardly revised 1.000 million in March. Analysts had expected building permits to rise to 1.010 million units in April. The report also showed that building starts rose to 1.072 million units in April, from 0.947 million in March, whose figure was revised up from a previously estimated 0.946 million. Analysts had expected building starts to rise to 0.980 million units last month.

The data neutralized any movement for the greenback, with USD/JPY inching down just -0.09% to 101.48 at the end of the session. It was a similar story in the eurozone, with official data showing that bloc’s gross domestic product grew just 0.2% in the first quarter, compared to expectations for growth of 0.4%. On a year-over-year basis the bloc’s economy expanded 0.9%, falling short of expectations for growth of 1.1%. While a separate report showed that the annual rate of inflation was unchanged at 0.7% in April, in line with forecasts, but still well below the ECB’s target of close to but just under 2%.

Investors also continue to monitor developments in Ukraine following U.S. Secretary of State John Kerry statement that Russia would face broader economic and industrial sanctions if it meddled in Ukraine’s presidential elections on May 25.

EUR/USD ended the session, down -0.11% at 1.3696.