RTTNews - There was little let-up in the assault on the dollar Tuesday morning in New York, with risk appetite rising following yesterday's signs of strength from both the US and Chinese manufacturing sectors.
The dollar slumped to a fresh 5-month low against the euro and stayed near multi-month lows against most other majors, even as equity markets appeared poised to pull back after big gains in the past few sessions.
After being favored earlier in the year as a safe haven during the throes of the financial crisis and global recession, the dollar has come under heavy pressure of late, with traders seeing plenty of green shoots on the economic horizon.
While consumer confidence figures, manufacturing, and rising commodity prices may be signaling a considerable slowing of the recession, the jobs situation remains bleak, the housing crisis lingers on, and the Federal Reserve may be foreced to raise rates to prevent runaway inflation -- all of which threaten to snuff out expansion.
Tuesday morning, traders will be presented with forward-looking industry data from the housing sector. The National Association of Realtors will reveal its pending home sales figures for the month of April, with the pending home sales expected to edge up by 0.5 percent.
The dollar dropped to 1.4279 versus the euro, its lowest level since the last week of 2008. Considering today's decline, the dollar has dropped almost 17 cents since early March.
Unemployment in the Eurozone rose to its highest level in nearly ten years in April as the global economic downturn pulled a number of Europeans out of work, official data showed Tuesday. The seasonally adjusted jobless rate rose to 9.2% in April from 8.9% recorded in March, the Luxembourg-based statistical office Eurostat said Tuesday.
The dollar ticked lower versus the resurgent sterling, slipping to 1.6500 for the first time since last October. Back in January, the dollar hit a 23-year high of 1.3501.
Tuesday, a report from the Bank of England said the number of loans approved for house purchases in the U.K. increased to 43,201 in April from 40,038 in March. The April level was higher than the previous six months average of 33,845 and 41,000 expected by economists.
The dollar continued its run of choppy trading versus the yen, slipping to 95.60 in early dealing Tuesday. The pair has been stuck in the mud for the past few weeks, with traders finding reasons to sell the lower-yielding currencies in favor of the euro and sterling.
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