US dollar holds steady against euro after economic data
Posted: 25 November 2009 0708 hrs

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NEW YORK: The US dollar was relatively steady against the euro on Tuesday as traders weighed US economic data for signs of recovery from recession.

The euro edged down to 1.4959 dollars at 2200 GMT from 1.4963 in New York late Monday.

Against the Japanese currency, the dollar fell to 88.54 yen from 88.97 yen.

Fresh US government data showed the world's biggest economy grew more slowly than initially estimated, in line with most analysts' expectations.

The Commerce Department reported gross domestic product (GDP) expanded at a 2.8 percent annual rate in the July-September period, less than the initial estimate last month of 3.5 percent.

Despite the weaker pace, the third quarter growth still marked the first expansion after four consecutive quarters as the economy emerges from recession.

"Although the third quarter was a period of recovery for practically all of the major economies, we are beginning to learn that the recovery may not have been as impressive as previously reported," said Kathy Lien, research director at Global Futures and Forex.

Separately, the Conference Board, a private research firm, said its monthly US consumer confidence index rose slightly in November after two months of declines but remained mired in the doldrums.

"Neither US GDP or consumer confidence deviated enough from expectations to prompt any fresh position taking, with the USD (US dollar) looking comfortably range-bound for the week," said Michael Woolfolk of The Bank of New York Mellon.

Quiet trading was expected ahead of Thursday's Thanksgiving Day holiday.

In earlier trading in Europe, the euro had benefited briefly from the publication Tuesday of positive eurozone data, analysts said.

German business confidence surged in November, according to a closely watched survey, fuelling hopes that Germany, Europe's economic powerhouse, could lead the continent out of recession.

The Ifo institute survey showed business sentiment rose to a stronger than expected 93.9 from 92.0, the eighth successive rise and the highest level since August 2008.

The European Union reported that factory orders in the 16-nation eurozone rose in September, although more recent data has suggested economic recovery in Europe may be peaking.

New industrial orders rose by 1.5 percent from August, when they had climbed a weaker 0.6 percent, according to the EU statistics agency.

Russia's central bank meanwhile cut its main interest rate to a record low 9.0 percent to check a strengthening ruble that threatens crucial exports. It blamed the ruble's rise partly on speculative currency investments.

In late New York trading, the dollar stood at 1.0097 Swiss francs, compared with 1.0096 late Monday.

The pound was at 1.6576 dollars, down from 1.6604. - AFP/de