Dollar pares losses vs yen and euro after US data

Dollar pares losses vs yen and euro after US data

Published: Tuesday, 6 Aug 2013 | 9:20 AM ET

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The dollar slightly pared losses versus the yen on Tuesday after data showed the U.S. trade deficit narrowed sharply in June to its lowest level in more than 3-1/2 years.

Imports reversed the prior month’s spike, suggesting an upward revision to second-quarter growth.

How much pain is in store for the Aussie?

Robert Rennie, global head of FX strategy at Westpac Bank, thinks the currency has priced the Reserve Bank of Australia’s 25 basis point interest rate cut on Tuesday.

The Commerce Department said the trade gap fell 22.4 percent to $ 34.2 billion, the smallest since October 2009. The percentage decline was the largest since February 2009.

The dollar last traded at 98.14 yen, down 0.2 percent on the day. It had been trading at 98.06 yen before the data.

The euro briefly dropped after the data, but then gained ground to last trade at $ 1.3292, up 0.3 percent on the day. It had been trading at $ 1.3286 before the data.

The dollar slightly pared losses versus the yen on Tuesday after data showed the U.S. trade deficit narrowed sharply in June to its lowest level in more than 3-1/2 years.

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