U.S. Dollar Falls On Rate Cut Hopes

The U.S. dollar traded lower against its most major counterparts in the European session on Friday, as weak existing home sales and durable goods orders data released overnight raised expectations that the Federal Reserve would cut rates next week.

The U.S. durable goods orders fell more than expected in September and shipments also declined.

U.S. new home sales pulled back in September, falling 0.7 percent to a seasonally adjusted 701,000 units.

The data supported hopes of a rate cut by the Federal Reserve for a third time this year.

Markets widely expect the Fed to reduce interest rates by a quarter-point, taking it to 1.5 percent to 1.75 percent.

On the trade front, hopes faded for a resolution to the Sino-U.S. trade dispute after U.S. Vice President Mike Pence adopted a hard line in a speech Thursday laying out President Donald Trump's China policies and reiterating U.S. support for protesters in Hong Kong.

China hit back at Pence's criticism, accusing of lying and chiding him for disregarding American problems like racism and wealth disparity.

The currency showed mixed trading against its major counterparts in the Asian session. While it was steady against the pound and the euro, it rose against the yen and the franc.

The greenback depreciated to 0.9907 against the franc, from an 8-day high of 0.9931 seen at 12:15 am ET. On the downside, 0.96 is possibly seen as the next support level for the greenback.

The greenback reversed from an early high of 108.70 against the yen, dropping to 108.55. The next possible support for the greenback is seen around the 106.00 mark.

The U.S. currency weakened to 1.1123 against the euro and held steady thereafter. At yesterday's close, the pair was worth 1.1104.

Survey data from the market research group GfK showed that German consumer confidence is set to weaken to a three-year low in November.

The forward-looking consumer sentiment index fell to 9.6 in November from revised 9.8 in October. The expected score was 9.8. signs of weakness.

The greenback eased off to 1.3058 against the loonie and 0.6834 against the aussie, from its early high of 1.3077 and an 8-day high of 0.6809, respectively. The currency is seen finding support around 1.28 against the loonie and 0.71 against the aussie.

On the other side, the greenback hit a weekly high of 0.6356 against the kiwi from yesterday's closing value of 0.6383. Next key resistance for the greenback is likely seen around the 0.62 level.

The greenback reached as high as 1.2815 against the pound, up from a low of 1.2862 it touched at 3:00 am ET. The greenback is likely to find resistance around the 1.27 mark.

The University of Michigan's consumer sentiment index for October is scheduled for release in the New York session.

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