NEW YORK: The dollar retreated on Wednesday on further signs of a US economic slowdown after orders for core capital goods slipped more than expected in March as concerns festered about a looming vote in Congress over the unresolved debt ceiling.
The Swedish crown weakened sharply after the country’s central bank was less hawkish than expected, while the euro rebounded 0.65% from losses on Tuesday when jitters over US regional banks buoyed the safe-haven dollar.
The dollar index, which measures the currency against six major rivals, fell 0.422% as new orders for key US-manufactured capital goods fell more than expected last month, the Commerce Department said.
Shipments also declined, suggesting that business spending on equipment was likely a drag on economic growth in the first quarter.
The Norwegian crown “is also getting caught in the crossfire, and I think the scandies can weaken more and put pressure on the central banks to jawbone their currencies (i.e. try to talk them stronger),” said Broux.
The euro rose 1.05% against the crown to a high of 11.426, set for its biggest one-day gain since early March. The dollar, which traded down 0.7% against the crown before the Riksbank’s decision, rose 0.79% to 10.32.
The euro climbed 0.16% on the Norwegian crown to a fresh three year high of 11.747.
Sterling was last trading at $1.2462, up 0.44% on the day, while the yen strengthened 0.28% at 133.34 per dollar.
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