Forex News – US dollar up after good home sales data

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The US Dollar got a much needed boost after positive economic data showed new home sales rose in September higher than forecast.

Figures released by the US Department of Commerce showed that Americans bought 313,000 homes, which is equal to an increase of 5.7 percent. This beat expectations of a 300,000 home increase.

One main factor driving up homes sales was the slump in home prices, which were heavily discounted. Average home prices dropped by as much as 10 percent, marking the biggest drop in two years, since September 2010.

Meanwhile, earlier in the US trading session, other economic data showed demand for durable goods excluding transportation equipment rose last month by the most since March, with an increase of 1.7 percent beating estimates of a 0.5 percent rise. The previous month had a decline of 0.4 percent.

The data helped the US dollar rise, particularly against the Swiss franc and yen.

USDCHF is up 1.5 percent on the day, rising to as high as 0.8857 after the home sales data, from an earlier session low of 0.8728.

The dollar rose off its record low of 75.70 against the yen, jumping to 76.09.

Cable fell, as sterling was under pressure from a stronger dollar as well as uncertainty ahead of the EU Summit. GBPUSD fell to 1.5890 from the seven-week high of 1.6040.