Currency Alerts

During early Asian deals on Wednesday, the US dollar showed strength against its major counterparts.

Traders reacted positively to the release of a report from the National Association of Realtors showing that pending home sales increased by much more than expected in the month of April. The increase came as homebuyers responded to very favorable market conditions.

The report showed that the pending home sales index rose 6.7 percent to 90.3 in April from a reading of 84.6 in March. Economists had been expecting a much more modest increase by the index of about 0.5 percent. 

In corporate news, General Motors, which filed for voluntary Chapter 11 bankruptcy protection, revealed that it has entered into a memorandum of understanding, or MoU, with a buyer for its premium off-road brand Hummer. The deal would save around 3,000 jobs in the U.S.

Against the European currency, the US dollar edged higher during early deals on Wednesday. At 9:15 pm ET, the dollar reached a high of 1.4273 against the euro, compared to 1.4305 hit late New York Tuesday. The next upside target level for the US currency is seen around 1.402.

The US dollar that closed Tuesday's North American session at 1.6581 against the British pound climbed to 1.6549 during Wednesday's early Asian deals. The dollar is currently trading at 1.6577 versus the pound with 1.59 seen as the next target level. 

In economic news, consumer confidence in Great Britain improved in May, according to survey results from the Nationwide Building Society mortgage agency. Nationwide's consumer confidence index for May registered a reading of 53, compared to an upwardly revised reading of 51 in April.

The rate of shop price inflation in Great Britain fell to a four-month low in May, led by a sharp slowdown in fresh food prices. The British Retail Consortium reported today that shop price inflation in May increased 0.5% on month and 1.3 percent for the full year to May. Shop price inflation for April was down 0.5 percent on month and hit a 1.4 percent annualized rate.

Against the Swiss franc, the US currency showed strength during today's early deals. At 9:10 pm ET, the dollar-franc pair hit a high of 1.0641, compared to Tuesday's closing value of 1.0619. If the pair gains further, 1.082 is seen as the next target level. The US dollar is currently trading at 1.0624 against the Swiss currency.

Against the Japanese yen, US dollar gained ground after hitting a low of 95.39 during early Asian deals on Wednesday. At 9:45 pm ET, the dollar-yen pair rose to 95.84, compared to yesterday's closing value of 95.77. On the upside, 96.9 is seen as the next target level for the pair.