Dollar Weakening Despite Solid Economic Data
WASHINGTON (dpa-AFX) - The dollar is losing ground against all of its major rivals Thursday afternoon, despite the release of some more positive economic data.
The weakness in the U.S. currency seems to be due to political concerns, as investors continue to await the details of President Trump's tax policy.
A report released by the Labor Department on Thursday showed a slight increase in first-time claims for U.S. unemployment benefits in the week ended February 11th. The report said initial jobless claims edged up to 239,000, an increase of 5,000 from the previous week's unrevised level of 234,000. Economists had expected jobless claims to climb to 245,000.
New residential construction in the U.S. pulled back in the month of January, according to a report released by the Commerce Department on Wednesday. The Commerce Department said housing starts fell by 2.6 percent to an annual rate of 1.246 million in January after jumping by 11.3 percent to a revised 1.279 million in December.
Economists had expected housing starts to rise to 1.232 million from the 1.226 million originally reported for the previous month.
A reading on Philadelphia-area manufacturing activity unexpectedly showed a substantial acceleration in the pace of growth in the month of February, the Federal Reserve Bank of Philadelphia revealed in a report on Thursday.
The Philly Fed said its index for current manufacturing activity in the region soared to 43.3 in February from 23.6 in January, with a positive reading indicating growth. The jump surprised economists, who had expected the index to dip to 19.3.
European Central Bank policymakers broadly agreed to look through the energy-driven recent upturns in headline inflation and sought patience as they judged that the euro area economy required a substantial monetary stimulus to bring price growth to target, the minutes of the bank's policy session held on January 18-19 showed Thursday.
The Governing Council must carefully monitor potential indirect and second-round effects of the recent inflation spike, the minutes, which the ECB calls "account" of the meeting said.
The dollar has dropped to a 4-session low of $1.0660 against the Euro Thursday afternoon, from yesterday's high of around $1.0515.
Germany's employment grew at the weakest pace in three years during the fourth quarter of 2016, figures from Destatis showed Thursday. The number of employed rose by 0.6 percent year-on-year after 0.8 percent growth in the third quarter. The pace slowed for a third consecutive quarter.
The latest growth was the weakest since the fourth quarter of 2013, when employment rose 0.5 percent.
France's unemployment rate eased less-than-expected in the final three months of 2016, preliminary figures from the statistical office INSEE showed Thursday. The ILO jobless rate dropped to 10 percent from a revised 10.1 percent in the third quarter. Economists had forecast 9.8 percent.
The buck slipped to a low of $1.2523 against the pound sterling Thursday morning, but has since bounced back to around $1.2475.
The greenback has retreated to around Y113.335 against the Japanese Yen Thursday afternoon, from yesterday's high of around Y114.950.
Copyright RTT News/dpa-AFX