The US dollar was little changed against a basket of currencies on Wednesday, as investors digested a mixed bag of economic data that continued to paint a mixed picture of the recovery.
The US dollar index, a trade-weighted average of the dollar against a basket of currencies, was virtually unchanged at 98.76. The dollar index declined on Tuesday after nearly reaching 100.00 on Monday.
The dollar gained traction against the euro, which reversed Tuesday’s gains. The EUR/USD fell 0.5% to 1.0605. The pair faces initial support at 1.0556 and resistance at 1.0732.
The dollar advanced 0.3% against the Swedish krona, as the USD/SEK consolidated at 8.7899. The pair faces initial support at 8.7059 and resistance at 8.8457.
The dollar was virtually unchanged against the British pound, Swiss franc and Japanese yen, but declined against the Canadian dollar.
No clear storyline emerged from Wednesday’s economic data, which continued to paint a mixed picture of the US economy at the start of the spring season. US industrial production, which measures factory activity in the manufacturing, mining and utilities sectors, fell 0.6% in March. That was the biggest monthly drop in two-and-a-half years.
Separately, the National Association of Home Builders said housing market conditions improved faster than forecast this month, a sign warmer spring weather was supporting the housing recovery. The housing market index, a gauge of home builder confidence, rose to 56 in April from 53 in March. A median estimate of economists called for a gain to 55.
“As the spring buying season gets underway, home builders are confident that current low interest rates and continued job growth will draw consumers to the market,” said NAHB chairman Tom Woods in a statement.
“This uptick shows builders are feeling optimistic that the housing market will continue to strengthen throughout 2015,” assed NAHB chief economist David Crowe.
The Department of Commerce will release official housing figures on Thursday. Housing starts are forecast to rebound sharply from the weather-induced slowdown, climbing to a seasonally adjusted annual rate of 1.04 million in March. Housing starts had fallen to 879,000 in February. Building permits are expected to ease slightly to a seasonally adjusted annual rate of 1.08 million in March from 1.092 million the previous month.
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