AUTOREFRESH 
New York forex wrap-up; Dollar down but off worst levels
- US housing starts rise 17.2% ; higher than expected
- US PPI rises 0.2% in May, core falls 0.1%
- US industrial production falls 1.1% in May; capacity use 68.3%, a record low
- ECB’s Draghi: Too soon to end stimulus
- Tumpel-Gugerell: No big inflation risk; falling prices due to base effects
- BRICs make no mention of dollar in communique
- Weber: Worst over, don’t need further rate cuts
- Fed’s Warsh: Don’t confuse asset bounce with recovery
- CBO: 2010 US deficit forecast revised to 1.43 trln from $1.1 trln
- Reflation trade resumes slide in New York afternoon; oil sheds gains, dollar rebounds yields fall
- US equities fall 1.3%
EUR/USD made three attempts to break through the 1.3920/30 area on the topside in EUR/USD but failed amid talk of Chinese selling on rallies. Word that the BRIC countries did not include any discussion of the dollar in their communique helped brighten sentiment toward the greenback. Selling accelerated during the US afternoon as stops were triggered below the 1.3850 level as the reflation trade came under renewed pressure. Oil prices swung to the downside after rallying over $2 intraday. It closed lower on the day, at $70.53.
Cable showed remarkable resilience, closing firm at 1.6410 despite the broad dollar rebound. EUR/GBP fell to its lowest levels in six months at 0.8425.
Commodity currencies shed early gains like commodities themselves. USD/CAD closed at 1.1350 with uncertainty still over the Canadian budget. Doubts as to Chinese domestic demand being sustainable without a global recovery helped weigh on the AUD which ended at 0.7935.
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