The dollar fell against the yen on Friday after a government report showing a slower-than-expected contraction in the U.S. economy in the second quarter was offset by a decline in consumer spending.

That prompted investors to shun risk and weighed on U.S. stock futures. The euro also pared gains versus the dollar after the report.

The U.S. economy contracted at a 1.0 percent rate in the second quarter, according to government data on Friday. Analysts polled by Reuters had forecast GDP falling at a 1.5 percent rate.

Despite the fact GDP fell less than expected, investors focused on the consumer spending component, which showed a 1.2 percent drop after a 0.6 percent rise the previous quarter.

Consumer spending accounts for over two-thirds of U.S. economic activity.

“The better-than-expected number seems to be offset by a renewed decline in consumer spending,” said Ashraf Laidi, chief market strategist at CMC Markets in London.

“This report has written all

Gold rose on Thursday as the dollar fell versus a basket of currencies, with rebounding stock markets and U.S. jobless figures showing a decline in continuing claims boosting appetite for assets seen as higher risk.

U.S. data showed the number of U.S. workers filing new claims for jobless benefits rose slightly more than expected last week, but a gauge of underlying labor trends fell for a fifth straight week.

Spot gold was bid at $933.50 an ounce at 1311 GMT, against $929.00 an ounce late in New York on Wednesday. U.S. gold futures for August delivery on the COMEX division of the New York Mercantile Exchange rose $6.20 to $933.40 an ounce.

“If this is welcomed by the equities market and triggers a fresh boost, that could benefit gold,” said CMC Markets strategist Ashraf Laidi.

The dollar was down 0.39 percent at 79.3 against a basket of currencies and was lower against the euro following the

European shares were down in afternoon trade today, Wednesday, with banks leading the decline after quarterly results from U.S. banks Morgan Stanley and Wells Fargo disappointed investors.

By 1306 GMT, the pan-European FTSEurofirst 300 <.FTEU3> index of top shares was down 0.4 percent at 884.79 points after trading between 879.97 and 888.23 points.

“Morgan Stanley’s operating loss per share looks on the high side, compared to others in the sector. I think Morgan Stanley’s paying back public aid has distorted results; it is not known if this has been incorporated into analysts’ expectations of the results,” said Heino Ruland, strategist at Ruland Research.

Bank shares took the most off the index after Morgan Stanley reported its third consecutive quarterly loss and Wells Fargo reported rising credit losses.

“The continuing decline in asset quality is a worry, and whilst they are making money in other areas it just goes to show that conditions in the consumer segment

In the currency market, the dollar was marginally lower against the euro. Late Monday, the euro was trading at $1.4078 vs. $1.4068 on Friday.

“The U.S. dollar has started the week a touch firmer, with renewed concerns over the global recovery helping the greenback ahead of a busy week” of economic data, wrote strategists at Brown Brothers Harriman.

With the July 4th weekend ahead, the Labor Department will release the closely-watched tally of non-farm payroll losses a day early, on Thursday. Economists are projecting a net loss of about 325,000 jobs in June. Any strong variance from that figure is likely to have repercussions.

But if there are further indications that the ‘green shoots’ scenario is correct, will that necessarily have a positive effect on the buck? Many doubt it, even though a strengthening economy should portend a stronger greenback.

However, “The past seven years have proven each time U.S. data emerged on

In the currency market, the dollar lost ground to the euro. Late Thursday, the euro was trading at $1.3991 vs. $1.3926 on Wednesday.

“Equity and commodity markets advanced, encouraging rotation out of the greenback,” said analysts at Action Economics.

Also noted was that, “The dollar has been driven over the last two days by central bank activity. One is the Swiss National Bank, which appears to be continuing its buying of dollars,” said Meg Browne, a currency analyst at Brown Brothers Harriman.

The Swiss National Bank is publicly committed to stemming any haven-related appreciation in the franc, but as to what it may be doing, said that it doesn’t comment on intervention rumors.

However, the franc’s strength has proven “increasingly self-sustaining,” says Ashraf Laidi, chief market strategist at CMC Markets in New York. It has attracted support because of “broadening risk aversion, short-lived dollar strength and emerging doubts” about euro-zone banks,” Laidi said.

The

We’ve passed the midpoint in May and gold closed above $930 on Friday May 15th. This could be hugely significant and should give all prudent investors pause for thought.

Allow me to share with you an email message I sent to my family today that focuses in on my concerns on this topic. Although this will not be a long article, it is intended to motivate us to think “outside the box” as we slide into the “Sell in May and go away” time of the year. Here’s what I wrote my family today: “Realizing it is only the middle of May, it might be too early to say “it’s going to be different this year” when it comes to gold and silver.

“During the past seven years gold and silver always corrected between May and October, sometimes just

Gold was essentially unchanged to the mid-point of the London session on Friday, after which it took off and moved sharply higher to late morning, poking above $933 before sliding through the end of the Comex, only to perk up again on the Globex and rise to a finish at $930.90/oz., up $5.20. For the week, gold tacked on 1.6%.

Platinum peaked in the far East, slumped to the New York open, staged a very tepid rally, then slid again to end near its intraday low at $1101, down $10. For the week, platinum shed 4%.

Silver was down from late Hong Kong trading to the New York open, climbed to its high for the day, of $14.15, in the late morning, then slowly keeled over through the Globex to close at $13.95, down 10 cents. For the week, silver was off a miniscule 3/10 of one percent. (Click

In the currency market, the dollar pounded the euro. Late Monday, the euro was trading at $1.3039 vs. $1.3247 on Friday.

The main driver was the “growing concern that the Mexican swine flu could turn into a global pandemic,” said Adam Cole, global head of foreign exchange strategy at RBC Capital Markets.

With Mexico at the epicenter of the flu scare, it was no surprise that the peso suffered the most against the buck yesterday, dropping 4.7%.

“Clearly there’s a lot of uncertainty at play right now,” said James Hughes, market analyst at CMC Markets, and “any change in guidance over the outbreak from the likes of the WHO will be closely watched.”

Elsewhere, “We need a new resolution regime for large financial institutions,” said Sheila Bair, chairwoman of the Federal Deposit Insurance Corp. “Creating such a resolution authority would be very bold, but needed.”

The authority would be responsible for providing funding

In the currency market, the dollar was strong against the euro. Late Tuesday, the euro was trading at $1.3187 vs. $1.3373 on Monday.

The Commerce Department reported that the U.S. trade balance plunged by 29% to $40.4 billion in November, largely on a record decline in oil prices, assisted by much weaker demand for imports. At the same time, exports dropped 5.8% to $142.8 billion, led by weakening foreign demand for industrial supplies and capital goods.

“Trade flows have been crushed by the credit crunch, which has reduced demand for traded goods and services and made it more difficult for exporters and imports to obtain trade finance,” wrote Ian Shepherdson, of High Frequency Economics..

Ashraf Laidi, chief market strategist at CMC Markets, wrote that, “The 6% decline in U.S. exports is another sign of slowing global growth in the face of weakening global currencies against the US dollar.”

Traders still have one