Dollar Gains Against Other Major Currencies

The U.S. dollar was stronger against other major currencies on Thursday as risk sentiment weakened amid growing uncertainty about global economic recovery in the wake of the relentless surge in new coronavirus cases across the world.

A slew of economic data from across the globe, escalating tensions between the U.S. and China, and the European Central Bank’s monetary policy decision were the other factors that set the trend for the currencies.

In U.S. economic news, a report from the Labor Department said initial jobless claims slipped to 1.300 million in the week ended July 11th, a decrease of just 10,000 from the previous week’s revised level 1.310 million. Economists had expected jobless claims to drop to 1.250 million from the 1.314 million originally reported for the previous week.

Jobless claims fell for the fifteenth consecutive week, although the pace of decline has slowed considerably from April and May.

Data from the Commerce Department said retail sales soared by 7.5% in June after skyrocketing by an upwardly revised 18.2% in May. Economists had expected retail sales to jump by 5% compared to the 17.7% spike originally reported for the previous month.

The dollar index, which fell to around 95.89 by mid-morning, rallied to 96.40 subsequently, and was last seen at 96.30, up 0.23% from previous close.

Against the Euro, the dollar was stronger by about 0.25% at $1.1384, firming up from $$1.1412. The ECB today left its key interest rates and the size of asset purchases unchanged as policymakers weigh the effect of the previous actions. The main refi rate was left unchanged at a record low zero and the deposit rate at -0.50%, in line with economists’ expectations. The lending rate was kept at 0.25%.

The ECB also said it will continue its purchases under the pandemic emergency purchase programme (PEPP) with a total envelope of EUR 1,350 billion.

Against Pound Sterling, the dollar was up nearly 0.3% at $1.2553. The UK unemployment remained unchanged in three months to May, data from the Office for National Statistics showed. In three months to May, the jobless rate was largely unchanged at 3.9%, well below economists’ forecast of 4.2%.

The Yen was weaker at 107.28 a dollar, compared with 106.94 a dollar Wednesday evening.

Against the Aussie, the dollar strengthened to 0.6972, up more than 0.5% from previous close.

The Swiss franc was at 0.9455 a dollar in late afternoon trades, after having firmed up to 0.9430 earlier.

Against the Loonie, the dollar gained about 0.5%, with a unit of greenback fetching C$1.3574, as against C$1.3509 on Wednesday.

The material has been provided by InstaForex Company – www.instaforex.com