Foreign exchange market. American session: the U.S. dollar traded higher against the euro despite the weaker-than-expected U.S. economic data

The U.S. dollar traded higher against the most major currencies despite the weaker-than-expected U.S. economic data. U.S. retail sales increased 0.1% in April, from a 1.2% rise in March. March’s figure was revised up from 1.1%. Analysts had expected an increase of 0.5%. U.S. retail sales excluding autos were flat in April (March: +0.7%). Analysts had forecasted a 0.6% increase.

U.S. business inventories remained unchanged at 0.4% in March. This figure was expected by analysts.

The euro slid against the U.S. dollar due to the news Germany supports the additional stimulus measures by ECB and the weaker-than-expected economic data from the Eurozone and Germany. The ZEW Centre for Economic Research released the economic sentiment figures for May. German economic sentiment slid to 33.1 in May from 43.2 in April. Analysts had expected 41.3.

Eurozone’s economic sentiment declined to 55.2 in May from 61.2 in April. Analysts had forecasted 63.5.

The euro also remained under pressure due after The Wall Street Journal reported that Germany’s Bundesbank is willing to back additional stimulus measures from the ECB next month.

The British pound dropped against the U.S. dollar ahead of tomorrow’s U.K. labour market data and the BOE inflation letter.

The Canadian dollar traded higher against the U.S. dollar, supported by the weak U.S. economic data.

The New Zealand dollar traded higher against the U.S. dollar. Food price index in New Zealand rose 0.6% in April, from a 0.3% decrease in March. The weaker-than-expected economic data from China put pressure on the kiwi. Retail sales increased 11.9% in April, from a 12.2% rise in March. Analysts had expected an increase of 12.2%. China’s industrial production rose 8.7% in April, from an 8.8% rise in March. Analysts had forecasted an increase of 8.9%. Fixed asset investment in China climbed 17.3% in April, from a 17.6% gain in March. Analysts had expected a 17.8% rise. China is New Zealand's second biggest export partner.

The Australian dollar dropped against the U.S. dollar due to the weaker-than-expected economic data from Australia and China, but later recovered its losses. The house price inflation in Australia climbed 1.7% in the first quarter, from a 3.8% rise in the fourth quarter 2013. The fourth quarter figure was revised up from 3.4%. Analysts had expected an increase of 3.0%. Home loans in Australia declined 0.9% in March, from a 2.3% rise in February. Analysts had forecasted a 0.1% decrease.