US Dollar eases higher on solid US economic data

December 30, 2013

New York (Dec 31)   The dollar on Tuesday eased higher against most major currencies in pre-holiday trade following another batch of solid US economic data.   Near 2000 GMT, the euro traded at $1.3681, down from $1.3695 on Monday.

The dollar advanced to 104.27 Japanese yen from 104.11.

The euro also edged higher against the yen, buying 142.65 of the Japanese currency compared with 142.58.

The November report on US durable goods orders showed an increase of 3.5 per cent, more than expected. That was followed by a report on new home sales in the US that also bested expectations.

The strong data on durable goods "helped lift the dollar this morning," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange. "Still moves were limited as volumes remain very thin ahead of the Christmas holiday."

Tuesday's data came on the heels of other recent better-than-expected US economic reports, which have strengthened positive sentiment about the world's biggest economy after the Federal Reserve last week moved to scale back stimulus.

"On balance, the dollar continues to be underpinned by the Fed's $10 billion reduction in its asset purchases on December 18th, which was a vote of confidence in the stability of the U.S. economy," Esiner said.

Esiner expects low trading volume this week given that most of the world's major exchanges are closed Wednesday due to the Christmas holiday.

The British pound rose to $1.6368 from $1.6352.

The dollar increased to 0.8956 Swiss franc from 0.8939.

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