2008.12.2312:26:00UTC+00Euro Falls Versus Franc, Range-Bound With Others

The euro fell again versus the Swiss franc but was little-changed against most other major currencies on Tuesday in New York. Trading was lighter than usual because of the upcoming Christmas holiday.

The euro traded in a tight range with the U.S. dollar around 1.4000. Earlier in the week, the European currency climbed away from a near-term low of 1.3826 after hitting a multi-month high of 1.4718.

According to a report released by the US Department of Commerce, new homes sales fell 2.9 percent to an annual rate of 407,000 in November from a revised October rate of 419,000. Economists had been expecting new home sales to fall by about 4.2 percent.

The Commerce Department also reported that GDP decreased at an annual rate of 0.5 percent in the third quarter, as expected, unrevised from the estimate provided in November.

The European currency was also little-moved versus the British pound, trading at 0.9468. The euro extended a record high to 0.9556 earlier in the week.

The UK current account deficit totaled GBP 7.7 billion in the third quarter, equating to minus 2.1% of GDP, the Office for National Statistics said Tuesday. The shortfall for the second quarter was GBP 6.4 billion.

The euro was range-bound near 126.45 in the early afternoon versus the Japanese yen. The pair has been in a range since late last week. Against the Swiss franc, the euro fell to a five-week low of 1.5125.

Lorenzo Bini Smaghi became the latest European Central Bank Governing Council Member to state future ECB interest rates will be based on data. This adds to speculation the ECB may not cut rates in January.

Tuesday, the European Central Bank said the Eurozone current account deficit narrowed to a seasonally adjusted EUR 6.4 billion in October from EUR 8.8 billion reported in the previous month. This reflected EUR 9.7 billion deficit in current transfers and EUR 0.4 billion in income account. These deficits were partly offset by surpluses in services and goods accounts.

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