Investing.com - A better-than-expected weekly report on U.S.
jobless claims bolstered the dollar over other major currencies on
Thursday, though fears military conflicts in Ukraine and in the
Middle East may crimp global recovery capped the greenback's
advance and sent investors to gold.
In U.S. trading on Thursday, EUR/USD was down 0.13% at
The U.S. Department of Labor reported earlier that the number of
individuals filing for initial jobless benefits in the week ending
Aug. 2 fell by 14,000 to 289,000 from the previous week's total of
Analysts had expected jobless claims to rise by 2,000 to 305,000
last week, and the numbers confirmed market expectations for the
Federal Reserve to close its monthly bond-buying stimulus program
in October and begin hiking interest rates afterwards in 2015.
Demand for the greenback has been on the rise in recent sessions
due to upbeat U.S. trade balance, service-sector, economic growth
and other data.
Meanwhile in Europe, the European Central Bank kept its main
refinancing rate at 0.15% earlier Thursday in a widely anticipated
ECB President Mario Draghi attributed softening inflation rates
to energy concerns and added the monetary authority still expects
"moderate" and "uneven" economic recovery in the euro area
Interest rates will remain at present levels "for an extended
period of time," while the bank remains committed to using
unconventional measures if the outlook deteriorates, Draghi said,
adding that inflation is expected to remain soft in the coming
months before gradually rising in 2015 and 2016.
Risks to recovery remain to the downside Draghi said, though
heightened geopolitical risk could affect the economy.
Monetary authorities are still assessing possible impacts that
sanctions slapped on Russia for its alleged meddling in Ukraine may
on the euro area economy.
Still, the dollar did face headwinds of its own, mainly in the
form of geopolitical concerns that sent investors snapping up
safe-haven positions in gold, which tends to trade inversely with
Reports that Russia has amassed more troops near its border with
Ukraine have bolstered
due to the safe-haven appeal the yellow metal enjoys during times
of geopolitical uncertainty.
Since the West slapped sanctions on for allegedly meddling in
Ukraine's affairs by supporting separatists, Russian troops along
the border have reportedly jumped to 20,000 from 8,000.
News the U.S. is considering launching air strikes in Iraq to
halt a Sunni insurgency as well as conduct airdrops of food and
medicine to assist those displaced by the conflict bolstered gold
and softened the greenback also.
The dollar was down against the yen, with USD/JPY down 0.06% at
102.05, and up against the Swiss franc, with USD/CHF up 0.12% at
The greenback was up against the pound, with GBP/USD down 0.11%
In the U.K. earlier, the Bank of England said it was maintaining
the benchmark interest rate at 0.50% and that the stock of asset
purchases financed by the issuance of central bank reserves will
remain at £375 billion.
The dollar was up against its counterparts in Canada, Australia
and New Zealand, with USD/CAD up 0.06% at 1.0923, AUD/USD down
0.89% at 0.9271 and NZD/USD down 0.07% at 0.8472.
The US Dollar Index, which tracks the performance of the
greenback versus a basket of six other major currencies, was up
0.13% at 81.59.
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