German data helps euro rise against dollar

NEW YORK: The dollar sold off Tuesday as Germany's positive data on industrial orders contrasted with the glumness pervading the US economy.

The euro rose to $1.4688 at 2100 GMT from $1.4572 a day earlier, continuing its climb from the $1.40 level of May 23.

Rising confidence in Europe's getting a handle on its biggest problems -- especially Greece -- has given the European currency a boost in recent days.

"The recent correction in equities, emerging markets and commodities appears to be running out steam, supporting an overall bearish dollar tone," said Brown Brothers Harriman.

"An Easter boost to eurozone retail sales combined with better-than-expected German factory orders has provided a further lift to the euro."

German industrial orders bounced back in April, official data showed Tuesday, suggesting Europe's biggest economy continues to perform well.

Industrial orders rose 2.8 percent in April from March, topping the 1.9 percent expected according to analysts polled by Dow Jones Newswires.

The dollar was not helped by an uninspiring account of the US economy late in the day by US Federal Reserve chairman Ben Bernanke.

Bernanke said the dismal housing sector was holding the economy down and that there had been a "loss of momentum" in the US jobs market in the second quarter.

While Bernanke predicted a better second half to the year, he suggested that policies to stimulate growth needed to be sustained -- a likely hint that there was no thinking that ultra-low US interest rates needed to go higher anytime soon.

"Accomodative monetary policies are still needed," he told an Atlanta audience.

The Japanese currency edged up slightly, with the dollar buying 80.05 yen from 80.07 late Monday.

At 2100 GMT the dollar was buying 0.8366 Swiss francs, up from 0.8353 on Monday. The pound rose to $1.6445 from $1.6349.

Copyright AFP (Agence France-Presse), 2011