The first half of the trading week was nearly devoid of any economic data. However, investors were bombarded with a number of important reports this morning. The results proved mixed and the dollar is currently turning in a mixed performance against its major competitors. Manufacturing data from New York and Philadelphia came in weaker than expected, while weekly jobless claims logged an unexpected decline. Inflation data for September was in line with expectations.
First-time claims for U.S. unemployment benefits unexpectedly decreased in the week ended October 10th, according to a report released by the Labor Department on Thursday, with claims matching their lowest level in over forty years.
The report said initial jobless claims fell to 255,000, a decrease of 7,000 from the previous week’s revised level of 262,000. The drop surprised economists, who had expected jobless claims to climb to 270,000 from the 263,000 originally reported for the previous week.
Consumer prices in the U.S. fell in line with estimates in the month of September, the Labor Department revealed in a report on Thursday, although the report also showed that core prices rose slightly more than expected.
The Labor Department said its consumer price index slipped by 0.2 percent in September after edging down by 0.1 percent in August. Economists had expected prices to dip by 0.2 percent.
While the Federal Reserve Bank of New York said its reading on regional manufacturing activity increased in the month of October, the index continued to indicate a contraction in business activity for New York manufacturers.
The New York Fed said its general business conditions index rose to a negative 11.4 in October from a negative 14.7 in September, but a negative reading continues to indicate a contraction in manufacturing activity. Economists had expected the index to climb to a negative 7.0.
After reporting an unexpected contraction in regional manufacturing in the previous month, the Federal Reserve Bank of Philadelphia released a report on Thursday showing that manufacturing conditions continued to weaken in October.
While the Philly Fed said its diffusion index for current activity climbed to a negative 4.5 in October from a negative 6.0 in September, a negative reading continues to indicate a contraction in manufacturing activity. Economists had expected the index to climb to a negative 1.0.
U.S. economic activity continued to expand modestly from mid-August through early October, the Fed said in its Beige Book report Wednesday afternoon.
Some of the Fed districts expressed concern about the strength of the U.S. dollar on exports and tourism, but housing and consumer spending remained a relative bright spot.
Manufacturing conditions were “generally sluggish” and wage gains were “mostly subdued,” a sign that the Federal Reserve might delay raising interest rates for now.
The dollar jumped to a high of $1.1361 against the Euro Thursday morning, from yesterday’s month and a half low of $1.1495.
Germany’s manufacturing employment and earnings increased in August, Destatis reported Thursday. In local manufacturing units, nearly 5.4 million people worked in August. Employment increased by about 52,000 or 1 percent from same period of last year.
The buck rose to a high of $1.5413 against the pound sterling Thursday morning, but has since pulled back to around $1.5475, nearly unchanged for the day.
The greenback dropped to nearly a 2-month low of Y118.045 this morning, but has since rebounded to around Y118.690.
Japan’s industrial output declined more than estimated and tertiary industry activity grew only marginally in August, reports from the Ministry of Economy, Trade and Industry showed Thursday. Industrial output fell 1.2 percent in August from July, which was bigger than a 0.5 percent drop estimated initially.
The material has been provided by InstaForex Company – www.instaforex.com