The dollar was down in early trade Thursday, but is now gaining ground against its major competitors. The currency reversed direction after the release of the better than expected weekly jobless claims data.
After reporting a notable pullback in first-time claims for U.S. unemployment benefits in the previous week, the Labor Department released a report on Thursday showing a slight rebound in initial jobless claims in the week ended May 2nd.
The report said initial jobless claims edged up to 265,000, an increase of 3,000 from the previous week’s unrevised level of 262,000. Economists had expected jobless claims to climb to 280,000. While jobless claims showed a modest increase, they remained close to the fifteen-year low set in the previous week.
Investors will be watching for the release of the U.S. employment report of April on Friday. Economists are expecting non-farm payroll employment to rise by 220,000 for the month, while the unemployment rate is expected to dip to 5.4 percent.
The dollar dipped to over a 2-month low of $1.1391 against the Euro Thursday morning, but has since rebounded to around $1.2690.
German factory orders recovered in March after falling for two straight months, supporting hopes of a moderate economic growth in the first quarter. Factory orders grew 0.9 percent month-on-month in March, offsetting February’s 0.9 percent fall, data from Destatis showed Thursday. But the growth rate was weaker than a 1.5 percent rise forecast by economists.
French industrial production dropped unexpectedly in March, figures from the statistical office Insee showed Thursday. Industrial production dropped 0.3 percent month-on-month in March, defying economists’ expectations for a 0.1 percent slight increase. In February, production had risen a revised 0.5 percent.
France’s merchandise trade deficit for March narrowed from a year ago, data from the French Customs showed Thursday. The trade deficit contracted to EUR 4.575 billion from EUR 4.698 billion in the same month last year. However, the deficit figure was much larger than February’s shortfall of EUR 3.623 billion.
Polling is underway in the U.K., with opinion polls showing neither the Conservatives nor Labor party could win enough seats for an outright majority in Parliament. Prime Minister David Cameron’s Conservatives and Ed Miliband’s Labour Party are racing neck-and-neck, with none expected to get a majority of 326 seats, out of 650 seats in the House of Commons. With no clear winner in sight, another coalition government is a highly probable outcome of the election.
The buck is little changed against the pound sterling Thursday. The U.S. currency rose to a high of $1.5162, but has since eased back to around $1.5225.
The greenback fell to a 1-week low of Y119.052 against the Japanese Yen Thursday morning, but has since climbed to around $119.800.
The material has been provided by InstaForex Company – www.instaforex.com