US dollar activity was limited yesterday, as the currency moved sideways at best. Despite a number of data results coming out ahead of expectations, the dollar fell against the majority of its major partners. The most influential figure of the day was the Producers’ Price Index (PPI), which showed an unexpected gain. This helped to limit the losses for the currency, with the dollar finishing the day little changed against sterling but down against the euro. The only other release was the housing market index, and this also came out better than expected, but ultimately failed to add strength to the dollar.
Overnight we heard from another member of the Federal Reserve, while today sees a raft of US data throughout the afternoon. Starting things off will be the building permits, which will also be supported by data on housing starts and oil levels. Positive results could help the dollar ahead of a more important event which is the release of the Federal Reserve meeting minutes from their last meeting. Speculation ahead of this could also impact markets, as investors try to gauge future policy on interest rate rises. Any clues on this subject in the minutes could also affect the dollar’s performance, as any signs on timescales will give investors plenty to think about.