The dollar strengthened against major currencies Monday, rebounding from a string of recent declines after comments by Federal Reserve Chairman Ben Bernanke that the U.S. economy is showing signs of leveling out.
Analysts continue to anticipate that at some point signs of strength in the U.S. economy will be read as positive for the nation's currency, ending an inverse relationship since the credit crisis began where negative news triggered safe-haven buying of the dollar.
That relationship held as stocks rose, weighing on the currency. So far this month the dollar has fallen 0.3% while the Standard & Poor's 500 Index (SPX) gained 3.9%.
"The market continues to experience range-bound activity on the whole, with external factors the major driver, although generally speculative positioning has been limited today despite equity markets trading in positive territory," said analysts at Action Economics.
On Monday, the dollar bought 94.71 Japanese yen, up from 94.32 yen late Friday in North American trading.
The euro was marginally lower, changing hands at $1.4327 after finishing Friday at $1.4345.
The dollar index (DXY) recently rose modestly to 78.065 from 78.020 late Friday. The index, which tracks the greenback against a trade-weighted basket of six major currencies, lost 0.9% last week.
On a quiet day for economic data, a release from Eurostat showed industrial orders in the euro area up 3.1% in June from May levels but down 25.1% from the prior year.
While no major U.S. economic reports are expected Monday, data in the coming days are expected to show improvement in durable-goods orders, new-home sales and consumer confidence.
Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=volVj0Da4Km1o4h%2FMmQEQA%3D%3D. You can use this link on the day this article is published and the following day.
