Dollar Higher As Upbeat Data Underscores Fed Rate Hike Bets
May 26 2016 - 5:09AM
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The U.S. dollar was trading higher against most major rivals in
European deals on Thursday, after data showed that durable goods
orders surged in April and weekly jobless claims declined more than
expected last week, heightening speculation that Fed will raise
rates as soon as June.
Data from the Labor Department showed that first-time claims for
U.S. unemployment benefits decreased for the second straight week
in the week ended May 21st.
The report said initial jobless claims fell to 268,000, a
decrease of 10,000 from the previous week's unrevised level of
278,000. Economists had expected claims to edge down to
275,000.
Data from the Commerce Department showed that U.S. durable goods
orders surged up much more than expected in April, partly led by a
jump in orders for commercial aircraft and parts.
The durable goods orders spiked up by 3.4 percent in April,
beating forecasts for a 0.3 percent gain.
The U.S. pending home sales are due shortly, while Fed governor
Jerome Powell will speak on the economy and monetary policy in
Washington D.C. at 12:15 pm ET.
The Fed Chair Janet Yellen speaks at Harvard University on
Friday, with investors aiming to get more clues about a U.S. rate
hike in June.
The greenback was lower against most major rivals in Asian
deals, as investors booked some profits from the currency's recent
rally.
The greenback advanced to 0.9927 against the Swiss franc, after
having fallen to a 3-day low of 0.9884 at 1:15 am ET. Continuation
of the greenback's uptrend may see it finding resistance around the
1.02 zone.
Preliminary data from the Federal Statistical Office showed that
production in the Swiss industry and construction sectors rose for
the first time in more than a year during the first quarter even as
turnover declined.
The second sector output, which includes industry and
construction, grew 1 percent year-on-year following 1 4.2 percent
decline in the final three months of last year.
Reversing from an early 2-day low of 1.1192 against the euro,
the greenback bounced off to 1.1159. The greenback is seen finding
resistance around the 1.10 mark.
The greenback recouped its early losses against the yen with the
pair trading at 109.96, off early 2-day low of 109.42. On the
upside, 112.00 is likely seen as the next resistance level for the
greenback.
On the flip side, the greenback held steady against the pound,
after bouncing off from its early new 3-week low of 1.4739. The
pair was worth 1.4695 when it finished yesterday's trading.
The second estimates from the Office for National Statistics
showed that the U.K. economy expanded as initially estimated in the
first quarter.
Gross domestic product grew 0.4 percent in the first quarter
from previous three months, unrevised from the estimate published
on April 27. It was slower than the 0.6 percent expansion posted in
the fourth quarter of 2015.
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