Dollar declines, gold up after soft U.S. data

Wed May 13, 2015 4:54pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Caroline Valetkevitch

NEW YORK (Reuters) - The dollar index hit its lowest in more than three months while gold prices jumped on Wednesday as weaker-than-expected U.S. retail sales bolstered confidence the Federal Reserve will hold off raising rates soon.

Wall Street's major indexes ended little changed after gaining early in the session on the data, which showed U.S. retail sales were flat in April as households cut back on purchases of automobiles and other big-ticket items, indicating the economy was struggling to rebound.

The dollar index, which measures the greenback against a basket of six major currencies, hit a more than three-month low of 93.461 .DXY.

"The market is basically convinced that the Fed is not going to do anything until the consumer shows some strength," said Boris Schlossberg, managing director of FX strategy at BK Asset Management in New York.

The Fed has said it will raise rates only when data points to a strengthening economy. Growth in the first-quarter slowed to a crawl as a strong dollar, harsh winter and a steep fall in oil prices hurt profits and discouraged consumers from spending.

Gold jumped, rising well above $1,200 an ounce to a five-week high as the dollar fell. XAU=

On Wall Street, the Dow Jones industrial average .DJI fell 7.74 points, or 0.04 percent, to 18,060.49; the S&P 500 .SPX lost 0.64 points, or 0.03 percent, to 2,098.48; and the Nasdaq Composite .IXIC added 5.50 points, or 0.11 percent, to 4,981.69.

MSCI's all-country world index .MIWD00000PUS of stock performance in 46 countries was up 0.3 percent, also helped by some signs of improved growth in Europe.   Continued...

Traders work on the floor of the New York Stock Exchange May 12, 2015. REUTERS/Brendan McDermid