Tuesday morning in Asia, the UK's sterling rallied against its major counterparts following the latest consumer survey report from the GfK Group showed that UK consumer sentiment indicator rose unexpectedly in March. The pound rose to a 6-day high against the euro and a 4-day high against the rest of majors.
Consumer confidence was higher for the second consecutive month in Great Britain, data consolidator GfK said, suggesting that measures to end the recession are starting to take hold. The increase was the highest level since May after the Bank of England slashed interest rates to a record low 0.5 percent.
The consumer confidence index came in at -30 versus analyst expectations for a score of -37 following the -35 reading in February. British consumers became more optimistic about the general economic outlook over the next 12 months, also upgrading their assessment of the state of the economy over the past 12 months.
The pound advanced to a 6-day high of 0.9242 against the common currency of Europe by 8:55 pm ET. This may be compared to Monday's North American session closing value of 0.9255. As of 10:25 pm ET, the euro-pound pair was worth 0.926.
Investors expect a raft of economic reports in the upcoming session, including the German unemployment rate for March, French housing starts for February, Italian retail sales for January, Italy's preliminary inflation and the euro-zone CPI estimate-both for the month of March.
The pound jumped to a 4-day high of 140.61 against the Japanese yen by 9:00 pm ET. The pound-yen pair, which closed Monday's New York trading at 138.8, is currently worth 140.30. On the upside, 141.65 is seen as the next target level for the pound.
The yen weakened across the board after a government report revealed that Japan's jobless rate rose a 3-year high.
Japan's seasonally adjusted unemployment rate came in at 4.4 percent in February, the Ministry of Health, Labor and Welfare said today - slightly higher that forecasts for a 4.3 percent increase after the 4.1 percent increase in January.
All household spending was down 3.5 percent on year, the data showed, versus expectations for a 4.7 percent annual fall after the 5.9 percent contraction in January.
Against the Swiss franc also, the pound climbed to a 4-day high in early Asian trading on Tuesday. The pound climbed to 1.6433 against the franc around 9:00 pm ET, compared to Monday's New York closing value of 1.639. The pound-franc pair is currently quoted at 1.6402.
Traders are expecting the Swiss UBS consumption indicator for March, which tracks consumer spending in Switzerland, in the early European session today.
Bouncing back from yesterday's 12-day low, the pound inched up to a 4-day high of 1.4321 against the US dollar by 10:15 pm ET. If the pound ticks up further, resistance is seen around 1.445. The cable that closed Monday's New York deals at 1.4269 is currently trading near 1.43.
A flurry of economy reports, which are due out in the New York session may likely influence the dollar today.
The S&P/Case-Shiller home price index, which tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the U.S., is scheduled to be released at 9 AM ET. Economists expect an 18.5% year-over-year decline in the 20-city composite house price index in January.
At 9:45 am ET, the Chicago Purchasing Managers Index for March is due out. Analysts expect the headline figure to rise modestly to 34.4 from 34.2 in February.
The Conference Board is scheduled to release its consumer confidence report for March at 10 am ET. The survey, which is based on a survey of 5,000 US households, is expected to show that the consumer confidence index to rise to 28.0 in March from 25.0 in February.
US Fed's Plosser is due to deliver a speech on Financial Regulatory Reform in Chicago on Tuesday at 1:00 PM.
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