Dollar Mixed After Weak Economic Reports

The dollar is turning in a mixed performance Thursday afternoon, with the year quickly drawing to a close. The U.S. currency is gaining ground against the Euro and the British pound, but is falling against the Japanese Yen. The U.S. released a pair of weaker than expected economic report this morning, with weekly jobless claims and the Chicago PMI both coming in below expectations.

Ahead of the release of the monthly jobs report next week, the Labor Department released a report on Thursday showing that first-time claims for U.S. unemployment benefits rose by more than expected in the week ended December 26th.

The report said initial jobless claims climbed to 287,000, an increase of 20,000 from the previous week’s unrevised level of 267,000. Economists had expected jobless claims to edge up to 270,000.

Chicago-area business unexpectedly saw a continued contraction in the month of December, according to a report released by MNI Indicators on Thursday. MNI Indicators said its Chicago business barometer dropped to 42.9 in December from 48.7 in November, with a reading below 50 indicating a contraction in activity.

The decrease by the business barometer came as a surprise to economists, who had expected the index to climb to 50.0.

The dollar rose to a 1-week high of $1.0851 against the Euro Thursday afternoon, from around $1.0930 this morning, but has since eased back to around $1.0875.

The eurocoin indicator, which measures the current economic situation in the euro area, increased notably in December to the highest level in four-and-a-half years, the Bank of Italy and the Centre for Economic Policy Research said in a survey report on Thursday.

The eurocoin indicator rose to 0.45 in December from 0.37 in the previous month. The latest reading was the highest level since July 2011.

The buck has broken out to a 7-month high of $1.4735 against the pound sterling Thursday morning, from around $1.4830 this morning.

Britons’ housing equity injections decreased to the lowest level in almost six years in the third quarter, the Bank of England said Thursday. Households injected GBP 8.82 billion in the third quarter compared to GBP 12.17 billion in the previous three months. This was the lowest since the fourth quarter of 2009, when it totaled GBP 8.1 billion.

The greenback has slipped to a 2-month low of Y120.185 against the Japanese Yen Thursday afternoon, from around Y120.400 this morning.

The material has been provided by InstaForex Company –