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Dollar falls on U.S. data, escalating Ukraine conflict

Published 08/15/2014, 03:11 PM
Updated 08/15/2014, 03:13 PM
Dollar slides on soft U.S. data, mounting Ukraine tensions

Investing.com - The dollar traded largely lower against most major currencies on Friday, as a mixed bag of data coupled with a fresh flare up in the Russia-Ukraine conflict stoked concerns the U.S. economy still faces headwinds as it recovers.

In U.S. trading on Friday, EUR/USD was up 0.24% at 1.3398.

A double-shot of mixed data and geopolitical concerns took its toll on the dollar on Friday.

The preliminary Thomson Reuters/University of Michigan consumer sentiment index ticked down to a nine-month low of 79.2 in August from 81.8 in July. Analysts had expected the index to rise to 82.5 this month, and the disappointing figure weakened the U.S. currency.

Separately, the New York Federal Reserve said that its Empire State manufacturing index fell to a four-month low of 14.69 this month from 25.60 in July, worse than expectations for a decline to 20.0.

Data also showed that U.S. producer price inflation rose 0.1% on year last month, in line with expectations, after a 0.4% increase in June.

Core producer price inflation, which excludes food, energy and trade, rose 0.2% in July, in line with market projections, and after a 0.2% gain the previous month.

A separate report showed that U.S. industrial production rose 0.4% in July, beating expectations for a 0.3% gain.

The day's data fueled ongoing uncertainty as to how much time will pass from when the Federal Reserve closes its monthly bond-buying stimulus program and when it begins hiking interest rates.

News that Ukrainian troops destroyed a portion of a Russian column of armored vehicles inside Ukraine rattled nerves on Wall Street, which kept the greenback in negative territory versus the single territory.

Russia said the reports were untrue, denying that armored vehicles were in Ukraine, though fears tensions are on the rise steered investors away from the U.S. currency, which tends to suffer from concerns that geopolitical tensions will dampen U.S. recovery.

The dollar was down against the yen, with USD/JPY down 0.12% at 102.33, and down against the Swiss franc, with USD/CHF down 0.44% at 0.9026.

The greenback was down against the pound, with GBP/USD up 0.07% at 1.6698.

The dollar was mixed against its cousins in Canada, Australia and New Zealand, with USD/CAD down 0.12% at 1.0890, AUD/USD up 0.06% at 0.9325 and NZD/USD down 0.05% at 0.8488.

The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.20% at 81.47.

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