Dollar near One-Week Low in Quiet Asian Opening - 19.3.2012

US Dollar US dollar was steady against the majors in Asian trading hours. The dollar index remains below 80, close to a one-week low 79.71. At the same time Treasuries fell on Friday. The benchmark 10-year securities dropped for the ninth straight day, the strongest decline since 2006. This week several macroeconomic reports are expected to be issued in the United States. The data may show increases in housing starts and building permits, as well as in existing and new home sales. Asian trading session was rather quiet today so that the dollar fell more or less considerably only against the yen from 83.56 to 83.06. Euro The euro traded in a narrow range against the US counterpart this morning – 1.3154-1.3182. On Friday the single currency managed to show a considerable rally and reached a one-week high versus the greenback – 1.3186, and a 4-month high versus the Japanese yen – 110.00. The euro rallied after German Chancellor Angela Merkel said that European authorities had discussed possibilities to combine the temporary and permanent financial stability mechanisms. On March 30 finance ministers from the euro area will meet to discuss the issue, while Bloomberg informed without giving exact source of information that the total amount of the bailout fund may reach 692 billion euros. On the other hand the central bank of Spain reported on Friday that the nation’s government debt reached 68.5% of GDP in the fourth quarter, the highest level since 1990s. Australian Dollar The Australian dollar also reached a one-week high against the greenback today – 1.0620. However by the beginning of the European trading session the Aussie fell back below 1.0600. Today the head of the Reserve Bank of Australia Glenn Stevens said in a conference that China’s economy may leave behind the economy of the euro zone in a few years and may reach the GDP of the United Stated in a decade. Recently the government of China lowered the target for the economic growth pace to 7.5%. However a slowdown was necessary to decrease inflation and maintain a sustainable recovery path, said the governor of the RBA. He also noted that the slowdown in China’s growth is already reflected to some degree in the price of the Australian dollar, while its further performance will depend as well on the US dollar which in its turn is a function of the largest economy’s recovery.