US Dollar at November 2010 Levels on Recovery Concerns

The US dollar dropped against the euro for a second day in a row today and reached a new 2-month low against it as the dollar bulls were concerned with the pace of the economy recovery.

The US currency is down against all other major currencies except Canadian dollar, following the report on US housing starts and building permits. The seasonally adjusted annual rate of the new home starts dropped from 553,000 to 529,000 in December — the weakest rate since October 2009. The CAD was still affected by the yesterday’s central bank statement and fell even against the weak USD.

Euro’s growth against the dollar has reached its daily peak just after release of the above-mentioned data. But it wasn’t a sole reason for the EUR/USD pair to rise to its maximum level since November 23, 2010. The markets also reacted to the result of the meeting of the European financial ministers about the Eurozone debt crisis.

EUR/USD went up from 1.3385 to 1.3485 as of 17:36 GMT after going as high as 1.3538 intraday. USD/JPY dropped from 82.60 to 81.98, while GBP/USD rose from 1.5961 to 1.5980.

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