FX Summary
The dollar rallied in early N.Y. trade on Tuesday, as the unit was buoyed by a very hot U.S. July PPI report, and about as-expected housing starts data. EUR/USD moved toward the trend lows under 1.4630 early on, though greenback gains ultimately came unwound, and then some. The U.S. equity market sold off sharply on the back of the inflation data, along with ongoing financial market concerns, while oil prices rebounded nearly $4/bbl to $116.65 in afternoon trade. These events combined to take the dollar to lows of the week versus most major currencies, as a decent squeezing out of USD longs set in.