Dollar lower to noon but bouncing back

THE dollar was lower at noon but is recovering some of its losses, due to poor economic data from the US.

THE dollar was lower at noon but is recovering some of its losses, due to poor economic data from the US.

At midday (AEDT) today, the dollar was trading at US98.26c, down from yesterday's close of US97.6c.

Since 7am, the local unit traded between US97.85c and US98.27c.

During the morning the ollar has risen from its local open of US97.98c.

CMC Markets foreign exchange dealer Tim Waterer said there had been decreased buying interest in the US dollar this morning.

Data from the US overnight showed housing starts plunged to a near-record low in October, while building permits were flat.

Meanwhile, core US consumer prices rose at a weaker than expected rate in October.

"It did take a bit of momentum away from the greenback and that's allowed the Aussie, Euro and gold prices to push a little bit higher to start the Asian session.

"It has been enough to push the Aussie dollar back above US98c," Mr Waterer said.

Data from the US overnight (AEDT) includes jobless claims but Mr Waterer said the main driver for currency markets will continue to be news on the sovereign debt issues in Europe.

"That's having a big impact on traders' willingness to branch out into riskier assets," he said.

Mr Waterer expects the local unit to trade between US97.70c and US98.50c for the rest of the local session.

Meanwhile the bonds market was weaker at noon.

At 8.30am on the ASX 24, the December 10-year bond futures contract was at 94.495 (implying a yield of 5.505 per cent), down from yesterday's close of 94.540 (implying a yield of 5.460 per cent).

The December three-year bond futures contract was at 94.830 (5.170 per cent), down from 94.870 (5.130 per cent).