CANBERA (dpa-AFX) - The U.S. dollar strengthened against its major counterparts in the New York session on Tuesday, as U.S. housing starts rebounded in March and industrial production grew more than forecast, spurring confidence in economic momentum.
Data from the Commerce Department showed that housing starts jumped by 1.9 percent to an annual rate of 1.319 million in March after tumbling by 3.3 percent to a revised 1.295 million in February.
Economists had expected housing starts to increase by 2.1 percent to a rate of 1.262 million from the 1.236 million originally reported for the previous month.
The Commerce Department said building permits also surged up by 2.5 percent to an annual rate of 1.354 million in March after slumping by 4.1 percent to a revised 1.321 million in February.
Data showing a bigger than expected increase in U.S. industrial production in March also improved sentiment.
The Fed report showed that industrial production climbed by 0.5 percent in March after surging up by a revised 1.0 percent in February.
Economists had expected production to increase by 0.4 percent compared to the 1.1 percent jump originally reported for the previous month.
The greenback has been trading higher against its major rivals in the European session.
The greenback strengthened to 0.9658 against the Swiss franc, its highest since January 18. The greenback is seen finding resistance around the 0.98 region.
The greenback bounced off to 107.17 against the Japanese yen, from a 5-day low of 106.88 hit at 3:00 am ET. On the upside, 110.00 is likely seen as the next resistance for the greenback.
Reversing from an early near a 3-week low of 1.2414 against the euro, the greenback moved up to 1.2343. The next possible resistance for the greenback is seen around the 1.22 level.
Survey data from the Mannheim-based think tank ZEW showed that German economic confidence declined sharply in April.
The ZEW Indicator of Economic Sentiment dropped to -8.2 in April from +5.1 in March. The score was forecast to fall to -1.
Having fallen to near a 2-year low of 1.4377 against the pound at 3:30 am ET, the greenback reversed direction and rose to 1.4305. If the greenback rises further, it may find resistance around the 1.40 level.
Data from the Office for National Statistics showed that the UK unemployment rate declined in three months to February and earnings of employees increased.
The ILO jobless rate came in at 4.2 percent in three months to February, which was below the 4.3 percent logged in three months to January. This was the lowest rate since comparable data began in 1971.
The greenback hit a weekly high of 0.7327 against the kiwi, off its early 4-day low of 0.7373. The greenback is likely to find resistance around the 0.72 region.
The greenback recovered to 0.7760 against the aussie, from a 4-day low of 0.7791 hit at 3:15 am ET. On the upside, 0.76 is likely seen as the next resistance for the greenback.
Minutes from the Reserve Bank of Australia's April 3 meeting showed that members of board said that the country's economy is expected to continue on its gradual path of growth.
The country's inflation rate is also expected to pick up gradually, the bank said, while global economic conditions remain positive.
Copyright RTT News/dpa-AFX