The dollar weakened versus other major currencies Wednesday morning in New York as the outlook for stocks improved on Wall Street, fueling increased risk appetite. The buck came under pressure versus the euro and sterling, slumping to a 10-day low against its British counterpart.
Gross domestic product data for the first quarter will be released at 8:30 am ET this morning, headlining a busy day on the economic front. Economists expect the GDP report to show a 4.7 percent decrease in the first quarter following a 6.3 percent decrease in the fourth quarter.
The Federal Reserve also concludes its two-day meeting on Wednesday, with the Federal Open Market Committee due to announce the results of the meeting at about 2:15 pm ET. The Fed is widely expected to leave interest rates unchanged near zero.
The dollar extended its big losses from the previous session against the euro this morning, dropping nearly a penny from its overnight level to 1.3280. With the retreat, the dollar continued to move away from a monthly high of 1.2884, set last week.
Eurozone economic sentiment improved in April, for the first time since May 2007, from a record low, a survey conducted by the European Commission showed Wednesday.
Economic sentiment rose to 67.2 in April from a revised reading of 64.7 in March, the first increase since May 2007. The index stood above the expected reading of 65.6.
Wednesday, the German government said the economy will grow 0.5% in 2010, benefiting from stimulus measures and recovery of exports.
However, the economy will shrink 6% this year, the worst contraction since the World War II and sharper than a 2.25% fall predicted in January.
The dollar also fell further versus the sterling, dropping to a 10-day low of 1.4795. Over the past 24 hours, the dollar has fallen almost 3 cents. Still, on a longer term basis, the dollar is little changed from late March, having come back from big mid-April losses.
The dollar remained stable versus the yen Wednesday morning, staying near the 97 mark. Two days ago, the dollar hit a 6-week low of 95.60, extending a dramatic move away from a multi-month high of 101.43, set earlier in April.
The White House is calling on Congress to add $1.5 billion to an emergency spending bill in reaction to a deadly influenza outbreak.
Press Secretary Robert Gibbs said the request was made out of an abundance of caution to enhance national capabilities to respond to the swine flu, which has killed more than 100 people in Mexico and now has registered 68 cases in the US -- though none in the US appears to be life threatening.
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