RTTNews - The dollar managed to pare some of its losses after a brutal start to Friday's session. Early on, positive eurozone economic data hurt the safe-haven buck across the board, but cautious remarks from Fed Chairman Ben Bernanke helped the dollar recover against the yen and sterling.
Bernanke said Friday that the world is only now beginning to emerge from a deep recession that could have been decidedly worse had the U.S. and other countries not taken aggressive policy action.'
After contracting sharply over the past year, economic activity appears to be leveling out, both in the United States and abroad, and the prospects for a return to growth in the near term appear good, Bernanke said.
The dollar stabilized versus the euro after Bernanke's speech, holding near 1.4330 after dropping to a weekly low of 1.4375. The buck found support before testing its 2009 low of 1.4446, set earlier in the month.
The Eurozone private sector economy showed signs of broad stabilization as the Purchasing Managers' Index hit the threshold level for August. A return to growth in manufacturing output and slowing rate of contraction in the service sector led to the stabilization.
The dollar fought back against the sterling, and wound up little-changed near 1.6500. Three weeks ago, the dollar hit a 10-month low of 1.7012.
Versus the yen, the dollar slumped to a monthly low of 93.41 before rebounding to 94.40.
Back in the US, existing home sales increased by much more than expected in the month of July, according to a report released by the National Association of Realtors on Friday, with home sales rising for the fourth consecutive month.
The report showed that existing home sales rose 7.2 percent to an annual rate of 5.24 million units in July from a 4.89 million-unit rate in June. Economists had been expecting a more modest increase to a 5.0 million-unit rate.
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