Euro, US dollar weaken

New figures showed Tuesday that retail sales in Australia were up by 1.1 percent in March, twice the amount expected by analysts. The new data helped the Australian dollar add 0.5 percent versus the US dollar to $0.8285 in mid-afternoon trade in New York. With the new figures also came renewed speculation that the Reserve Bank of Australia might raise interest rates again soon. Also helping out the currency, and the rate speculation, a new Australian federal budget was released Tuesday, calling for tax cuts and more spending.

The euro, on the other hand, was weaker after March’s German industrial production data was weaker than had been expected. The shared currency dropped 0.4 percent to £0.6796 against sterling, while it was 0.5 percent lower to $1.3530 in relation to the US dollar and fell 0.6 percent to ¥162.15 versus the yen. The European Central Bank is expected to keep interest rates on hold when it meets Thursday, but most analysts expect a rate hike in June.

The US dollar also lost value during the session. Aside from its decline versus the Australian dollar, it fell 0.1 percent against both the yen and sterling, to ¥119.20 and $1.9910 respectively. The Federal Reserve is likely to keep interest rates at 5.25 percent on Wednesday.

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