Dollar Hits Monthly Peak On Reports Bundesbank Will Back ECB Easing
Washington (May 13) The dollar rallied to a new one-month high versus the euro on Tuesday, bolstered by speculation the European Central Bank will soon inject cash into the eurozone economy.
Reports out of Germany said the Bundesbank is on board with monetary easing measures being planned for June.
This as Germany's economic expectations for May fell to the weakest level since early 2013, a closely watched survey showed Tuesday.
The economic sentiment index fell more-than-expected to 33.1, the lowest since January 2013 , from 43.2 in April, data from the Mannheim-based Centre for European Economic Research/ZEW showed Tuesday.
A weaker-than-forecast reading on US retail sales prevented bigger gains for the dollar, which rose to USD1.3690 against the euro.
The buck has advanced more than 3 cents in the past week.
Modest gains took the dollar to USD1.6780 versus the sterling.
The dollar edged a bit higher to Y102.30 versus the yen, but remains locked in a tight trading range.
After reporting a sharp increase in US retail sales in the previous month, the Commerce Department released a report on Tuesday showing that retail sales inched up by less than expected in the month of April.
The report said retail sales edged up by 0.1% in April after surging up by an upwardly revised 1.5% in March.