The euro tumbled Tuesday to its weakest level against the dollar in a month as weak economic data from across the globe helped support the greenback ahead of Friday’s eagerly anticipated U.S. jobs report.
The European shared currency fell to a low of $1.0719, its weakest level since Dec. 3, when it erased a month of losses after the European Central Bank delivered a package of stimulus measures that was less comprehensive than investors had hoped. It trimmed some of its losses to trade at $1.0746 late Tuesday in New York, compared with $1.0826 late Monday in New York.
Adding to the pressure on the shared currency were preliminary data on eurozone inflation, which showed prices in the region rose by only 0.2% in December, a softer rate than economists had expected.
Tumult in China’s markets has also been an important driver of the currency market so far this week. Concerns about slowing growth in China helped support the dollar against the euro, while simultaneously pushing it lower against the yen for a second straight day–despite an effort by Chinese officials to calm jittery markets by injecting 130 billion yuan ($19.9 billion) in short-term funds into the country’s financial system.
The yen strengthened against the dollar, extending Monday’s gains, as investor appetite for currencies perceived haven currencies endured. The dollar fell to ¥119.03, down from ¥119.30 late Monday in New York.
The Chinese yuan rose after the country’s central bank intervened in the foreign-exchange market to prop up its currency. A dollar bought 6.5209 yuan, down from 6.5377 yuan on Monday.
The pound dropped to $1.4668 from $1.4716 Monday.
The ICE Dollar index rose 0.5% to 99.3960, on track to rise a sixth straight session.
Source : Market Watch