Investing.com – The dollar dropped against the yen on Friday and was trading near six-week lows against the euro as recent U.S. economic data failed to convince market participants that the Federal Reserve will soon begin to taper its stimulus program.
USD/JPY hit session lows of 97.96, the highest since June 27, before settling at 98.30, down 1% for the day and 2.07% lower for the week.
The yen gained ground against the greenback after the release of mixed U.S. data on initial jobless claims and durable goods orders on Thursday.
The Labor Department said the number of individuals filing for initial jobless benefits last week increased by 7,000 to a seasonally adjusted 343,000, compared to expectations for an increase of 6,000 to 340,000.
The Commerce Department said orders for long lasting manufactured goods rose by a seasonally adjusted 4.2% in June, compared to expectations for an increase of 1.3%, while core durable goods orders, which exclude volatile transportation items, were flat in June, compared to expectations for a 0.5% increase.
EUR/USD hit highs of 1.3296 on Friday, before settling at 1.3279, up 0.01% for the day and 0.91% higher for the week.
The dollar found support earlier in the week, after data revealed new U.S. home sales hit a five-year high in June.
The Commerce Department reported earlier U.S. new home sales jumped 8.3% to 497,000 units, their highest level since May 2008.
Analysts were expecting new home sales to rise 1.8% to 482,000, which bolstered the dollar.
The pound was rangebound against the dollar on Friday, with GBP/USD dipping 0.03% to settle at 1.5386, up 0.13% for the week.
On Thursday, the Office of National Statistics said the U.K. economy expanded by 1.4% on a year-over-year basis in the second quarter, in line with expectations. The U.K. economy grew by 0.3% year-on-year in the first quarter.
The U.K. economy expanded 0.6% quarter on quarter, after a 0.3% expansion in the first quarter.
Elsewhere, the Canadian dollar was steady Friday, with USD/CAD easing 0.01% to settle at 1.0278.
Meanwhile, the Australian and New Zealand dollars came under pressure after weak Chinese manufacturing data for July added to fears over a slowdown in the world’s second largest economy, but the kiwi found support as the Reserve Bank of New Zealand left interest rates unchanged.
The preliminary reading of China’s HSBC manufacturing purchasing managers’ index fell to an 11-month low of 47.7 in July, from a final reading of 48.2 last month. Analysts had expected the index to rise to 48.6.
On Thursday, the RBNZ held its benchmark interest rate at 2.50%, in a widely expected move, and said it will keep borrowing costs at a record low this year.
AUD/USD hit session highs of 0.9296, before settling 0.9263, 0.19% higher for the day and up 0.45% for the week.
NZD/USD hit highs of 0.8105 in Friday’s session before trimming gains to close at 0.7931, easing up 0.01% for the day and 1.80% higher for the week.
In the week ahead, the Federal Reserve, the Bank of England and the European Central Bank are to publish their monthly policy statements. Canada and the U.S. are to produce economic growth data and the euro zone is to release data on manufacturing activity.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, July 29
Japan is to publish government data on retail sales, the primary gauge of consumer spending.
The U.K. is to release official data on net lending to individuals, which is the change in the total value of new credit issued to consumers, followed by industry data on realized sales.
Later in the day, the U.S. is to produce industry data on pending home sales, a leading indicator of economic health.
Tuesday, July 30
New Zealand is to publish official data on building consents, while Australia is to produce official data on building approvals. In addition, Reserve Bank of Australia Governor Glenn Stevens is scheduled to deliver a speech.
Japan is to release a preliminary government report on industrial production, while Bank of Japan Governor Haruhiko Kuroda is set to speak at the Research Institute of Japan, in Tokyo.
In the euro zone, a Gfk German consumer climate report is to be released, as well as preliminary data on German consumer price inflation and Spain’s gross domestic product.
Canada is to produce official data on raw materials price inflation.
The U.S. is to release a report on the Standard & Poor’s/Case-Shiller Composite-20 house price index, followed by the Conference Board’s report on consumer confidence.
Wednesday, July 31
New Zealand is to produce data on business confidence, a leading indicator of economic health, while Australia is to publish official data on private sector credit.
Elsewhere, Germany is to release official data on retail sales and unemployment change, while France is to publish an official report on consumer spending. In addition, official reports are to be produced on consumer price inflation and the unemployment rate for the entire euro zone.
Canada is to release official GDP data, which is the change in the inflation-adjusted value of all goods and services produced by the economy.
The U.S. is also to produce GDP data, as well as a report on non-farm employment change and data on manufacturing activity in Chicago. Separately, the Federal Reserve is to release its monthly monetary policy statement, which will be closely watched for indications on the future of the central bank’s stimulus program.
Thursday, August 1
Australia is to publish industry data on new home sales.
In Switzerland, markets are to remain closed due to a national holiday.
In the euro zone, reports will be released on manufacturing activity in Spain, Italy and the entire single currency bloc. Later in the day, the European Central Bank is to release its monthly monetary policy statement, followed by a press conference.
The U.K. is to produce a report on manufacturing activity, while the Bank of England will also publish its monetary policy statement.
The U.S. is to release official data on weekly unemployment claims, followed by a report by the Institute of Supply Management on manufacturing activity.
Friday, August 2
Australia is to release official data on producer price inflation, a leading indicator of consumer inflation.
The U.K. is to produce industry data on house price inflation, as well as a report on construction activity.
In the euro zone, data is to be published on Spanish employment change, while Switzerland is to release a SVME report on manufacturing activity.
The U.S. is to round up the week with official data on non-farm employmet change, the unemployment rate, average hourly earnings and personal spending, as well as a report on factory orders.