US focus: Dollar tumbles; Swiss Franc rallies to record

The dollar dropped as U.S. consumer spending rose less than forecast, adding to speculation the Federal Reserve will lag behind other central banks in raising interest rates.
U.S. consumer purchases rose 0.4% in April after a revised 0.5% gain in March that was smaller than previously estimated, Commerce Department data showed.
The dollar extended its loss versus the yen as National Association of Realtors data showed pending home resales in the U.S. plunged almost 12% in April. Economists had a forecast of 1% drop.
“In the past few days we’ve gotten a lot of weak data out of the U.S., so that’s fueling speculation of longer-term accommodation by the Fed, and that’s obviously going to weigh on the U.S. dollar,” said Eric Viloria, senior currency strategist at Gain Capital Group LLC.
“The overall tone is dollar weakness,” said Mark McCormick, a currency strategist at Brown Brothers Harriman & Co. “The Fed is going to remain on hold, the data we’re getting, risk appetite and the story in the equity markets - this is weak for the dollar.”
The Swiss franc rallied to a record against the euro and greenback as Europe’s sovereign-debt crisis encouraged demand for a refuge and Switzerland’s leading economic indicator held at the highest level in almost five years.  The KOF Swiss Economic Institute said its leading economic indicator was at 2.30, unchanged from April, which was the highest since August 2006. Economists forecast a drop to 2.22.
The franc has gained 4.6% this year.
The euro has weakened 2.5% over the past month.
“Concerns about sovereign debt are spreading in the region, weighing on the euro,” said Masahide Tanaka, a senior strategist at Mizuho Trust & Banking Co..
The yen dropped against the franc and the euro after Fitch lowered Japan’s outlook to negative from stable.