Dollar Climbs to 120 Yen After U.S. Housing Sales Surge

Men of Value Contributor · April 23, 2015

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(Bloomberg) — The dollar climbed to 120 yen for the first time in a week after a jump in U.S. sales of previously owned homes backed speculation that the Federal Reserve will raise interest rates this year. The greenback held a three-day advance against the euro before finance ministers from the currency bloc meet in Riga, Latvia, on Friday to persuade Greece to commit to economic reforms so that aid payments can be released before the country runs out of money. The European Central Bank almost doubled an increase in emergency funding to Greek banks ahead of the talks. “The dollar got a push higher from firm housing data,” said Masato Yanagiya, head of foreign exchange and money trading at Sumitomo Mitsui Banking Corp. in New York. “Whether the dollar advances further hinges on Greece’s situation, which is keeping investors from fully taking on risk.”
The U.S. currency touched 120 yen, before trading at 119.94 as of 8:47 a.m. in Tokyo from 119.91 on Wednesday. It was little changed at $1.0724 per euro, having gained 0.8 percent over the past three trading sessions. The Bloomberg Dollar Spot Index, which tracks the currency against 10 major peers, was at 1,192.55 from 1,191.90 Wednesday. Sales of previously owned homes jumped in March by the most in four years, putting the U.S. residential real estate market on firm footing heading into the busiest time of year. The proportion of analysts predicting the Fed will act in September rose to about 70 percent this month from 32 percent in March, according to an April 3-9 Bloomberg survey of economists. In Europe, the ECB’s Governing Council raised the cap on Emergency Liquidity Assistance by about 1.5 billion euros ($1.6 billion) to 75.5 billion euros on Wednesday, people familiar with the decision said. Greek Prime Minister Alexis Tsipras and German Chancellor Angela Merkel are due to meet on the sidelines of a European Union immigration summit in Brussels on Thursday, according to a Greek government official.

–With assistance from Mika Otsuka in New York.

To contact the reporter on this story: Chikako Mogi in Tokyo at cmogi@bloomberg.net To contact the editors responsible for this story: Garfield Reynolds at greynolds1@bloomberg.net Naoto Hosoda, Jonathan Annells

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Men of Value Contributor

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