July 16, 2019 / 3:00 PM / 2 months ago

FOREX-Dollar rises on upbeat retail sales data, euro falls

    * Weak ZEW investor reading put pressure on euro
    * Sterling falls below $1.24 for the first time since April
2017 
    * Graphic: World FX rates in 2019 tmsnrt.rs/2egbfVh

 (Updates market action, changes dateline, previous LONDON)
    By Richard Leong
    NEW YORK, July 16 (Reuters) - The dollar rose against a
basket of currencies on Tuesday as surprisingly strong growth in
U.S. retail sales in June soothed jitters about the American
economy and trimmed expectations the Federal Reserve may embark
on a deep interest rate cut later this month.
    The greenback strengthened versus the euro due to data that
pointed to a deterioration in confidence among German investors
prompted by the trade conflict between China and the United
States and political tensions with Iran.
    The British pound fell to six-month lows against the euro
and a 27-month trough versus the dollar as Conservative Party
members Boris Johnson and Jeremy Hunt, vying to be Britain's
next prime minister, were seen to be toughening their line on
Brexit negotiations. Investors are worried about the rising risk
of a no-deal exit from the European Union.
    "An improved U.S. economic outlook should provide some fuel
for further dollar gains," said Win Thin, global head of
currency strategy at Brown Brothers Harriman & Co.
    At 10:44 a.m. (1444 GMT), an index that tracks the dollar
against a group of six currencies was up 0.39% at 97.312
after touching 97.361, the highest in four sessions.
    Recent U.S. economic data have on balance beat expectations.
Concerns about the drag from global trade disputes and sluggish
inflation among developed economies, however, have led
policymakers to consider cutting interest rates and/or embarking
on bond purchases to boost investor confidence and business
activities.
    The U.S. Commerce Department said retail sales rose 0.4% in
June, exceeding the 0.1% increase forecast among analysts polled
by Reuters.
    Last week, Fed Chairman Jerome Powell hinted in testimonies
before Congress that the central bank was ready to "act as
appropriate" to support the current U.S. expansion, which is the
longest on record.
    U.S. interest rate futures implied traders
fully expect the Fed to lower key lending rates by at least a
quarter point at its July 30-31 policy meeting, according to CME
Group's FedWatch program.
    Traders also expect the European Central Bank to move policy
rates deeper into negative later this year as the euro zone
economy has been struggling.
    Earlier Tuesday, the ZEW Institute said its monthly survey
showed economic sentiment among German investors fell to -24.5
in July from -21.1 the month before.
    The euro was down 0.38% at $1.1215 and 0.09% lower at 121.35
yen.
    The single currency, however, was up 0.54% at 90.43 pence
 after touching a six-month peak at 90.43 earlier
Tuesday.
    Sterling fell below $1.24 for the first time since
April 2017. It was 0.91% lower at $1.2403.  
========================================================
    Currency bid prices at 10:46AM (1446 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.1216        $1.1257     -0.36%         -2.21%      +1.1263     +1.1208
 Dollar/Yen       JPY=        108.1700       107.9000    +0.25%         -1.90%      +108.2600   +107.8300
 Euro/Yen         EURJPY=     121.34         121.47      -0.11%         -3.87%      +121.6800   +121.1000
 Dollar/Swiss     CHF=        0.9873         0.9845      +0.28%         +0.60%      +0.9886     +0.9837
 Sterling/Dollar  GBP=        1.2405         1.2514      -0.89%         -2.76%      +1.2520     +1.2399
 Dollar/Canadian  CAD=        1.3028         1.3047      -0.15%         -4.47%      +1.3064     +1.3028
 Australian/Doll  AUD=        0.7028         0.7039      -0.16%         -0.30%      +0.7044     +0.7024
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.1073         1.1082      -0.08%         -1.61%      +1.1094     +1.1058
 Euro/Sterling    EURGBP=     0.9039         0.8993      +0.51%         +0.61%      +0.9042     +0.8994
 NZ               NZD=        0.6706         0.6716      -0.15%         -0.16%      +0.6737     +0.6708
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        8.5457         8.5407      +0.06%         -1.08%      +8.5684     +8.5367
 Euro/Norway      EURNOK=     9.5859         9.6150      -0.30%         -3.23%      +9.6310     +9.5886
 Dollar/Sweden    SEK=        9.3758         9.3533      -0.16%         +4.60%      +9.4026     +9.3481
 Euro/Sweden      EURSEK=     10.5175        10.5340     -0.16%         +2.47%      +10.5464    +10.5198
    

    
 (Additional reporting by Tommy Wilkes in LONDON
Editing by Angus MacSwan, Ed Osmond and Jonathan Oatis)
  
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