Dollar stalls as China data surprises
By Tom Westbrook
SINGAPORE (Reuters) — Asian currencies caught a boost from better-than-expected Chinese economic data on Wednesday, driving the yuan to a one-week high and putting a dampener on the U.S. dollar.
A blast at a Gaza hospital, however, kept moves modest and traders on edge at the prospect of a widening conflict. U.S. President Joe Biden is due to visit Israel on Wednesday. The shekel was pinned to the weaker side of 4 to the dollar.
Official data showed China's economy grew 1.3% in the third quarter, accelerating from 0.5% in the previous quarter and topping market forecasts for an increase of 1%. Industrial output rose and unemployment fell.
«It pretty much means the growth target for this year of around 5% will be achieved, maybe slightly above,» said UOB economist Woei Chen Ho in Singapore.
The yuan and trade-dependent Australian and New Zealand dollars all bounced. The Aussie was last up 0.2% at $0.6378. The kiwi rose by the same margin to $0.5909.
The yuan hit a one-week high of 7.2905 per dollar, though it then retreated to 7.306.
On Tuesday, U.S. yields had shot sharply higher after data showed retail sales increased strongly, which had helped the dollar pile pressure on the low-yielding Japanese yen.
The yen was last at 149.68 to the dollar and was squeezed, as the Bank of Japan unexpectedly announced $2 billion in bond-buying to keep downward pressure on yields.
Elsewhere the dollar struggled to gain, which some analysts suggested could point to a loss of momentum.
The benchmark 10-year Treasury yield has climbed about 100 basis points since mid July, and the dollar index is up 7% in the same period.
«It's had a really good run and it's stalled a bit,» said Westpac analyst Imre Speizer. «Maybe
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