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FOREX-Bullish ex-auto U.S. retail sales cheer dollar

Tue May 13, 2008 9:50pm IST
 
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(Adds details, updates prices)

* Dollar gains on retail sales ex-autos, import price data

* Data supports views Fed will not cut rates in June

* Sterling falls on weak British house price data

By Lucia Mutikani

NEW YORK, May 13 (Reuters) - The dollar rose broadly on Tuesday after unexpectedly strong U.S. retail sales, excluding automobiles, in April supported views that the Federal Reserve would probably not cut interest rates again next month.

Retail sales excluding the hard-pressed auto sector increased 0.5 percent, more than double the increase that economists had forecast, and followed a 0.4 percent pickup in March, suggesting that the U.S. consumer remained resilient despite the housing market rout.

The reading bolstered the dollar as consumer spending accounts for about two-thirds of the U.S. economy.

"Today we saw the strength of the consumer with retail sales being better than what the market expected, especially in household goods, which shows us consumers are still resilient" said Boris Schlossberg, senior currency strategist at DailyFX.com in New York.  Continued...

 
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