* Greenback weakens after strong Chinese data
* Aussie dollar outperforms
* Kiwi drops after inflation slows
(New throughout, updates trading and comments to U.S. market open,
new byline, changes dateline, previous LONDON)
By Karen Brettell
NEW YORK, April 17 (Reuters) - The greenback weakened on Wednesday
as better-than-expected economic data in China bolstered risk appetite
and boosted the Australian dollar.
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. The U.S. dollar is also
heading into a period of the year when it has traditionally weakened.
“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,” said Osborne.
The Australian dollar outperformed on the Chinese data. The
currency is sensitive to the economic fortunes of China, Australia’s
biggest trading partner.
"It is becoming very clear again this morning what really
matters for the Australian dollar is China. The currency is up despite
the fact that the RBA rate meeting caused negative sentiment
yesterday," said Esther Maria Reichelt, an FX strategist at
Commerzbank in Frankfurt.
The New Zealand dollar, meanwhile, 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.
Data on Wednesday also showed that the U.S. trade deficit fell to
an eight-month low in February as exports to China surged, helping to
eclipse a rebound in overall imports, which could boost economic
growth estimates for the first quarter.
Currency bid prices at 9:30AM (1330 GMT)
Description RIC Last U.S. Close Pct Change
YTD Pct High Bid Low Bid
Euro/Dollar EUR= $1.1299 $1.1280 +0.17%
-1.48% +1.1324 +1.1280
Dollar/Yen JPY= 111.9800 111.9900 -0.01%
+1.56% +112.1600 +111.9300
Euro/Yen EURJPY= 126.50 126.34 +0.13%
+0.22% +126.8100 +126.2900
Dollar/Swiss CHF= 1.0089 1.0078 +0.11%
+2.80% +1.0092 +1.0068
Sterling/Dollar GBP= 1.3046 1.3048 -0.02%
+2.27% +1.3068 +1.3030
Dollar/Canadian CAD= 1.3292 1.3349 -0.43%
-2.53% +1.3371 +1.3274
Australian/Doll AUD= 0.7198 0.7175 +0.32%
+2.11% +0.7205 +0.7154
Euro/Swiss EURCHF= 1.1401 1.1368 +0.29%
+1.31% +1.1412 +1.1366
Euro/Sterling EURGBP= 0.8661 0.8643 +0.21%
-3.60% +0.8680 +0.8642
NZ NZD= 0.6735 0.6761 -0.38%
+0.27% +0.6775 +0.6672
Dollar/Norway NOK= 8.4686 8.4911 -0.26%
-1.97% +8.4993 +8.4600
Euro/Norway EURNOK= 9.5712 9.5847 -0.14%
-3.38% +9.5963 +9.5711
Dollar/Sweden SEK= 9.2324 9.2571 -0.11%
+3.00% +9.2660 +9.2167
Euro/Sweden EURSEK= 10.4330 10.4445 -0.11%
+1.65% +10.4603 +10.4320
(Additional reporting by Tom Finn in London; Editing by Bernadette Baum)
((Karen.Brettell@thomsonreuters.com; +1 646 223 6274; Reuters