WASHINGTON (dpa-AFX) - The U.S. dollar traded firm against its major counterparts on Tuesday, riding on data showing a bigger than expected increase in retail sales in the U.S. in October, and a report showing a notable expansion in the country's industrial production.
According to a report released by the Commerce Department, retail sales spiked by 1.7% in October after climbing by an upwardly revised 0.8% in September. Economists had expected retail sales to jump by 1.4% compared to the 0.7% increase originally reported for the previous month.
The spike in retail sales has reinforced expectations for a faster tightening of monetary policy by the Federal Reserve.
The Federal Reserve also released a report showing industrial production rebounded by much more than expected in the month of October.
The report showed industrial production surged up by 1.6% in October after tumbling by 1.3% in September. Economists had expected industrial production to increase by 0.7%.
A separate report released by the National Association of Home Builders showed an unexpected improvement in U.S. homebuilder confidence in the month of November.
The report showed the NAHB/Wells Fargo Housing Market Index rose for the third straight month, climbing to 83 in November from 80 in October. The increase surprised economists, who had expected the index to come in unchanged.
Traders also reacted to Richmond Federal Reserve President Thomas Barkin's comments on Monday that while the Fed will not hesitate to raise interest rates, the central bank should wait to gauge if inflation and labor shortages prove to be more long-lasting.
The dollar index is at 95.98, up 0.6% over its previous close.
Against the Euro, the dollar is stronger at $1.1318, up from $1.1367.
The Pound Sterling has weakened to $1.3428 from $1.3415.
The dollar is trading at 114.81 yen, rising from 114.14 yen.
Against the Aussie, the dollar is at 0.7298, firming from 0.7347.
The Swiss franc has weakened to 0.9305 from 0.9236 a dollar. The Loonie is trading at US$1.2565, drifting down from US$ 1.2516.
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