The US dollar gained momentum against a basket of currencies, but weakened against the Japanese yen and the euro after weaker than expected growth in the US. The Commerce Department reported the economy grew 2.8% in the third quarter, lower than the forecasted 3.0%. The Conference Board reported consumer confidence edged higher in November and improved to 49.5. Although consumer confidence was higher, lower growth in the US put a damper on risk appetite. Market remains choppy this morning with the Federal Reserve minutes due out later today.
The euro strengthened vs. the dollar after better than expected Eurozone industrial new orders. The European Union's statistics office reported a 1.5% rise in new orders in September, buoyed mainly by demand for ships, planes and trains. This would be the sixth successive month of growth.
The Sterling gave back overnight gains as news that German bank West LB was struggling to secure funding highlighted the weakness that still lingers in the global banking sector. Although data showed UK mortgage approvals nearly doubled in October, the sterling has been under broad selling pressure as worries about the UK's fiscal weakness remains.
The Japanese yen strengthened to a six-week high against the dollar after data showed the US economy grew at a slower pace than expected in the third quarter. The yen was boosted as investors' appetite for risk waned for higher yielding currencies such as the Australian and New Zealand dollars.
The Canadian dollar was hurt by weaker oil prices and soft equity markets. With no major economic news from Canada until Friday, investors are expected to shift their focus on the US Fed Reserves minutes which will be released later today.
The Australian and New Zealand dollars both lost steam as investors sold the currencies to lock in their profits. In addition, investor's pulled out of the Aussie and the Kiwi as oil and commodity prices pull back, and Asian equities failed to track Wall Street higher.
The Mexican peso firmed 0.5% after a Fitch downgrade of the country's debt for the first time in more than a decade. Fitch cut Mexico's sovereign rating to BBB from BBB-plus.
10-Year Treasury Note Yield: 3.347%
Dow Jones Industrial Average: 10,417.77 - 33.71