After staying positive for much of the session till noon, the U.S. dollar turned weak and posted losses against some of its peers on Thursday.
Data released by the Labor Department this morning showed an unexpected uptick in first-time claims for U.S. unemployment benefits in the week ended September 19th.
The data said initial jobless claims inched up to 870,000, an increase of 4,000 from the previous week’s revised level of 866,000. Economists had expected jobless claims to drop to 843,000 from the 860,000 originally reported for the previous week.
A separate report released by the Commerce Department showed new home sales jumped by 4.8% to an annual rate of 1.011 million in August after skyrocketing by 14.7% to an upwardly revised rate of 965,000 in July. Economists had expected new home sales to pull back by 1.2%.
The dollar index, which rose to 94.59 in late morning trades, fell to a low of 94.20 around mid afternoon and was last seen at 94.37, down slightly from previous close.
Against the Euro, the dollar firmed up to 1.627 before losing ground and slipping to 1.1689. It subsequently regained some lost ground and was hovering around 1.1670 a little while ago, netting a small loss.
The Pound Sterling was slightly firmer, fetching $1.2741, compared to $1.2726 on Wednesday afternoon.
The Yen was slightly weak at 105.42 a dollar, after recovering from 105.54.
The Aussie was stronger with the AUD-USD pair trading at 0.7045, up nearly 0.4%.
The Swiss franc was weaker against the greenback at 0.9629, down more than 0.3% from Wednesday’s close, while the Loonie was firmer against the dollar at C$1.3359, gaining about 0.2%.
During their latest speeches some Fed officials’ called for more fiscal stimulus. The call for fiscal stimulus and rising worries about the pace of global economic recovery amid surging coronavirus cases lifted demand for the safe-haven currency.
Fed Chair Jerome Powell said on Wednesday that the economy had a long way to go before recovery and further fiscal support is required to limit damage caused by the coronavirus pandemic.
Fed Vice Chair Richard Clarida said that the economy was still in a deep hole and policymakers “are not even going to begin thinking” about raising interest rates for now.
Switzerland’s central bank retained its negative interest rates and said the expansionary monetary policy stance is needed to cushion the impact of the coronavirus pandemic on economic activity and inflation.
About high valuation of Swiss franc, the bank said it is willing to ‘intervene more strongly’ in the foreign exchange market, while taking the overall exchange rate situation into consideration.
The material has been provided by InstaForex Company – www.instaforex.com