Dollar weakens vs euro after China growth data tops views

* Data on Thursday will provide clues on European economy
* Kiwi drops after inflation slows

(Updates prices)
By Karen Brettell
NEW YORK, April 17 (Reuters) - The greenback weakened against the euro on Wednesday
as better-than-expected economic growth data in China bolstered risk appetite and a day
ahead of the release of closely watched economic data for the euro zone.
China's economy grew at a steady 6.4 percent pace in the first quarter, defying
expectations for a further slowdown, as industrial production surged and consumer demand
showed signs of improvement.
“Risk sentiment seems to have improved overnight on the back of the strong Chinese
data,” said Shaun Osborne, chief FX strategist at Scotiabank in Toronto.
Investors are closely watching Chinese and European economic data for signals that
global growth is recovering.
The release of Purchasing Managers Indexes (PMIs) for the manufacturing and service
sectors in Europe on Thursday will provide the next indication of the strength of the
European economy.
Investment inflows into Europe have been improving, which may give the euro a boost
against the greenback.
“We’re at the upper end of the range for the dollar and we think seasonal pressures
should start to weigh a little bit more on the dollar going forward. Generally this is
about the time of year when the dollar starts to soften up from a seasonal point of
view,” Osborne said.
The Australian dollar jumped on the Chinese data before giving back the gains. The
currency is sensitive to the economic fortunes of China, Australia’s biggest trading
The Aussie weakened on Tuesday after the Reserve Bank of Australia said that a cut in
interest rates would be "appropriate" should inflation stay low and unemployment trend
The New Zealand dollar fell after data showed that annual inflation slowed in the
first quarter, which raised the odds of an interest rate cut in the coming months.

Other data on Wednesday showed that the U.S. trade deficit fell to an eight-month low
in February as imports from China plunged, temporarily providing a boost to President
Donald Trump's "America First" agenda and economic growth in the first quarter.

Currency bid prices at 1417 EDT (1817 GMT):
Description RIC Last U.S. Close Pct YTD Pct High Bid Low Bid
Previous Change Change
Euro/Dollar EUR= $1.1295 $1.1280 +0.13 -1.52 +1.1324 +1.1280
Dollar/Yen JPY= 112.0400 111.9900 +0.04 +1.61 +112.160 +111.9300
Euro/Yen EURJPY= 126.53 126.34 +0.15 +0.25 +126.810 +126.2900
Dollar/Swiss CHF= 1.0108 1.0078 +0.30 +3.00 +1.0109 +1.0068
Sterling/Dollar GBP= 1.3031 1.3048 -0.13 +2.15 +1.3068 +1.3030
Dollar/Canadian CAD= 1.3343 1.3349 -0.04 -2.16 +1.3371 +1.3274
Australian/Doll AUD= 0.7167 0.7175 -0.11 +1.67 +0.7205 +0.7154
Euro/Swiss EURCHF= 1.1418 1.1368 +0.44 +1.44 +1.1421 +1.1366
Euro/Sterling EURGBP= 0.8666 0.8643 +0.27 -3.54 +0.8680 +0.8642
NZ NZD= 0.6716 0.6761 -0.67 +0.00 +0.6775 +0.6672
Dollar/Norway NOK= 8.4935 8.4911 +0.03 -1.68 +8.5022 +8.4600
Euro/Norway EURNOK= 9.5950 9.5847 +0.11 -3.15 +9.6045 +9.5711
Dollar/Sweden SEK= 9.2475 9.2571 +0.02 +3.17 +9.2660 +9.2167
Euro/Sweden EURSEK= 10.4470 10.4445 +0.02 +1.78 +10.4603 +10.4320

(Reporting by Karen Brettell
Additional reporting by Tom Finn in London; Editing by Bernadette Baum and Leslie Adler)

First Published: 2019-04-17 02:31:00
Updated 2019-04-17 20:37:05

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