The dollar was mixed against the majors in the Wednesday session, largely confined within recent ranges in lackluster trading. The greenback recovered from its session lows versus the euro at 1.4350 to hover near the 1.4230-level, while pushing the Canadian dollar just shy of the 1.10-figure. New home sales posted a strong reading in July, surging by its largest figure in nearly 4-years, up by 9.6% to 433k units versus 384k units from June. Building permits were drifted by 1.1% to 564k units in July. Meanwhile, durable goods orders were sharply better than expected, posting a gain of 4.9% versus a 2.2% decline a month earlier in June. The excluding transports July durable goods orders also improved, edging higher by 0.8% compared with a 1.6% increase a month earlier. In the coming session, traders will look ahead to weekly jobless claims and more importantly, the preliminary reading for Q2 GDP. Weekly jobless claims are expected improve to 565k from 576k a week earlier. Meanwhile, economic growth in the second quarter is expected to post a 1.4% contraction, deteriorating further from a 1.0% contraction in the previous quarter. The Q2 PCE is expected to hold steady at 1.3%. Tangible signs of improvements are beginning to show up, albeit the recovery remains fragile in the United States. In July, the conference board index increased 0.6% month-on-month from + 0.8% in June. It was the fourth consecutive month of increase, giving further prove that the U.S. economy might have bottomed. In a speech at the Jackson Hole Symposium, Fed Chairman Bernanke confirmed that the worst might be over for global economies, thus indirectly anticipating a safe-haven demand’s decline for U.S. dollars and Treasuries in the coming months. Nonetheless, the Federal Reserve will keep rates low for the first part of 2010 with inflation so mild. In July, the producer price index (PPI) fell 0.9% versus the expected -0.4%. In reality, after two months of gains, 6.5% in June and 15% in May, housing starts slid by 1.0% in July to 581,000 annualized (+2.5% expected). Nevertheless, singles component (three-quarters of the market) rose 1.7%, while multiple houses declined 13.3%. Starts are still above the average of the first three months of the year, although away from the over 2 million produced in 2005. 
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