USD strengthens on oil prices, consumer confidence

Story link: USD strengthens on oil prices, consumer confidence

The US dollar gained on the euro and the yen Tuesday as US consumer confidence grew and crude oil prices resumed their recent declines.

The Conference Board, an independent economic research organization, said its confidence index was up from 51 in June to 51.9 in July.

Meanwhile, the yen was hurt by gains in the unemployment rate in Japan, up to 4.1 percent in June, and by declines in household spending there, while the euro suffered from a decline in consumer confidence in France, where the office of national statistics said that sentiment has dropped to its lowest level in at least 21 years.

At around 11 a.m in New York, the dollar traded at $1.5602 to the euro while it took ¥108.2050 to buy a dollar.

The pound lost ground to the greenback and the euro after the Confederation of British Industry released new survey numbers which showed that only 25 percent of retailers said they sold more than last year, while 61 percent said they had sold less, with only food and shoe sales gaining and sales of durable goods falling.

In addition, the Bank of England reported that mortgage approvals fell to 36,000 in June, the fewest in nearly ten years.

In late morning trade in New York it took $1.9808 to buy a pound while the UK currency traded at 78.77p to the euro.

The New Zealand dollar saw declines after approvals for home construction fell 20 percent in June to just 1,337, the fewest in 22 years, leading to predictions that interest rates will decline in September.

The Australian dollar also weakened after the International Monetary Fund said that banks will continue to suffer from the US mortgage mess and that they would find it difficult to raise capital.

The New Zealand dollar traded at 73.72 cents US while the Aussie was at 95.11 cents US.

The South African rand traded at R7.4025 to the dollar, gaining ground on the popularity of carry trades and on the chance that interest rates there will rise even further.